Tether is 1/400 of the cryptocurrency market cap. Meaning "only" 1/400 of the money would be lost if Tether does an "exit scam" like Bitconnect did. Oh, and by the way, Bitconnect was larger than Tether.

To put things in context, the MtGox heist was worth about 1/20 of the market. However, back then Bitcoin was pretty much the only cryptocurrency and it was still just a technological curiosity. If Bitcoin could be "hacked" at this level, then people didn't really have a choice than think that maybe this technology isn't all that great, and may actually disappear.

I don't think the market would crash for 2 years straight again if $40 billion in cryptocurrency were stolen tomorrow. It would take a LOT to take down the whole market for good.

Even if you had events such as world's governments uniting to ban all cryptocurrency exchanges, which is highly unlikely (see Belarus announcing to make crypto tax-free today), it would still make crash the market for 2-3 years, until people figure out how to get around those regulations with decentralized exchanges.