That's not really how it works either. If the 24hr USDT volume is $175B, that just means people are trading the same USDT for other things multiple times in a 24 hour period. That's it. But two people cannot use the same Tether to buy different things at the same time, so market inflation due to USDT can never really be beyond its market cap.
Tether is a vehicle, not the money in the system. People use Tether because it can be traded against your favorite coin on your favorite exchange. For example Binance (the largest crypto exchange) doesn't offer any USD pairs, so if you are someone with a lot of dollars you buy some USDT with your USD at 1-to-1, then you go trade that USDT for whatever you want.
USDT causes a crash in crypto based on two properties: actual fraud / funny money shenanigans and market sentiment. I was only really addressing the former in my analysis, because "market sentiment" is basically impossible to do anything useful with in a future-telling sense.
If you and I both agree to trade 0.000001BTC @ a price of $1,000,000/BTC, meaning the total value of our trade is $1, and we both know that the supply of bitcoin is 19,000,000 coins. Does that make the "Market cap" of bitcoin 1.9Quintillion dollars? Obviously not.
Market cap is a historically bad metric to track when comparing things like this.
So back to your question at hand, how would a $80B USDT market cap topple a $500B market cap. Well, first we realize based on the above silly example, $500B isn't necessarily the real value. If Bitfinex (tether) has been printing USDT and using that to buy bitcoin, then the market cap of BTC is inflated by an asset effectively worth $0.
Once this realization sets in, panic selling starts, and there is an overwhelming greater number of sellers than buyers, and it doesn't take $500B worth of trades to topple a coin with a $500B market cap (if that market cap is inflated by hopes and dreams).
Tether is a vehicle, not the money in the system. People use Tether because it can be traded against your favorite coin on your favorite exchange. For example Binance (the largest crypto exchange) doesn't offer any USD pairs, so if you are someone with a lot of dollars you buy some USDT with your USD at 1-to-1, then you go trade that USDT for whatever you want.
USDT causes a crash in crypto based on two properties: actual fraud / funny money shenanigans and market sentiment. I was only really addressing the former in my analysis, because "market sentiment" is basically impossible to do anything useful with in a future-telling sense.