A cover is a transformative work covered under fair use. A similar argument to what you're saying could be made for any trend to ever exist on YouTube or the internet. No one owns the copyright for all the memes they make and share, yet I don't see takedown notices everywhere
Covers generally require permission and licenses, especially if making money off it. And it gets even more complicated if video is involved. It's just the vast majority of publishers aren't too concerned with them so they don't get hit that often.
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By American copyright law covers don't require permission as long as they're proven to be "sufficiently transformative." That's why you can record new backing and new vocals and not get punished, but simply adding a burp at a random point isn't protected.
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