Bitcoin News Today: Crypto Analyst Warns GENIUS Act Could Trigger 85-90% Bitcoin Volume Collapse

Crypto analyst Jacob King has issued a stark warning about the potential impact of the GENIUS Act on the cryptocurrency market, particularly focusing on Tether (USDT). King predicts that the passage of the GENIUS Act could lead to a significant collapse in the crypto market, describing it as the "bloodiest event in Bitcoin’s modern history." His concerns center around the potential banning of Tether, which he believes could trigger a massive market downturn.

According to King, the GENIUS Act, which is gaining momentum in Congress, could effectively ban Tether, the largest stablecoin by market capitalization. Despite the fears surrounding a potential ban, Tether has recently minted 160 billion USDT, reinforcing its dominance in the stablecoin market. King argues that this rapid minting of USDT is an attempt to artificially inflate crypto prices, including Bitcoin’s, in response to the regulatory threat posed by the GENIUS Act. Tether has faced criticism for its lack of transparency and allegations of unbacked printing, though the company has consistently denied these claims.

King also points to a wave of record ETF outflows this week, suggesting that institutional investors are quietly exiting their Bitcoin positions. He views this as a major red flag, indicating that "whales are abandoning the sinking ship" while retail investors remain unaware of the impending risk. Additionally, King claims that Tether insiders are offloading record amounts of Bitcoin through over-the-counter (OTC) trades, distancing themselves from the potential fallout. If true, this could mean that major players are shedding risk while keeping the market unaware of the scale of exits.

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.” In his view, the crypto market is built on fragile ground, and the removal of Tether could expose the entire system to collapse. However, it is important to note that King’s views are controversial and not supported by hard evidence. Still, 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.

While King’s post paints a bleak scenario, the GENIUS Act does not outright ban Tether but gives it 18–36 months to comply with new regulations. Contrary to the panic suggested by King, ETF data shows inflows rather than outflows. Overall, the market remains shaky, but there is no clear sign of an imminent “bloodbath.” The passage of the GENIUS Act through the Senate has created uncertainty in the crypto market, with some analysts predicting that it could lead to a market collapse. However, others believe that the increased regulation could actually benefit the market in the long run by increasing transparency and stability. The bill is now awaiting a vote in the House of Representatives, where its fate remains uncertain.

The GENIUS Act is just one of several pieces of legislation currently being considered by Congress that could impact the crypto market. The potential impact of the GENIUS Act on Tether and the broader crypto market remains to be seen. However, it is clear that increased regulation is on the horizon, and companies like Tether will need to adapt to these changes in order to continue operating in the U.S. market. The outcome of the House vote on the GENIUS Act will be closely watched by market participants, as it could have significant implications for the future of stablecoins and the crypto market as a whole.