Tethering, in any form, is not an acceptable method of confinement, see the handout Confinement of Dogs. Aggression Dogs that live outdoors in a fenced yard or on a chain are likely to develop aggressive behavior, toward both humans and other animals. Their situation fosters this aggression. They are, in a sense, forced to defend their yard from all the other creatures around them. The fence defines a territory that they staunchly defend.
Chains have an added problem.
When a dog feels threatened, it will either run or fight. When chained, a dog's only option is to fight. Over time, this aggressive reaction becomes an ingrained part of the dog's behavior. But unless your fenced yard completely surrounds your house, the dog is only protecting your lawn. If a burglar sees that your dog is in your yard, he knows the dog is not in your house.