Crypto analysts express concern over the potential threat to Tether (USDT) and the entire sector amid the anticipated passage of the GENIUS Act.
Legislative Outlook and Threat to Tether
According to analyst Jacob King, the GENIUS Act, which is gaining traction in Congress, could lead to a ban on Tether, the largest stablecoin by market cap. King argues that this ban could trigger a massive collapse across the crypto market. He suggests that this is why Tether has been 'desperately printing USDT out of thin air' to prop up crypto prices, including Bitcoin.
Institutional Outflows Signal Trouble
King also points to a wave of record ETF outflows this week, stating that institutions are quietly exiting their Bitcoin positions. He sees this as a major red flag, suggesting that 'whales are abandoning the sinking ship,' while retail investors remain unaware of the looming risk.
Possible Global Collapse of the Crypto Market
King’s core argument is that Tether is the foundation propping up Bitcoin. He estimates that 85–90% of BTC’s daily volume is dependent on USDT, which he calls 'fake volume.' Without Tether, he warns, 'people will realize how fake everything has been.' He believes that the removal of Tether could expose the entire system to collapse.
While King's post paints a bleak scenario, it's important to note that his views are controversial and not supported by hard evidence in this thread. However, his warning is sparking serious debate about stablecoin regulation and the real liquidity behind crypto markets, issues that could come into sharper focus as U.S. lawmakers push forward with crypto legislation.
