Cryptocurrency removes two pieces that you previously needed to trust: Validity of execution and order of execution. Without considering smart contracts that'

Cryptocurrency removes two pieces that you previously needed to trust: Validity of execution and order of execution. Without considering smart contracts that's basically enough. With smart contracts there are many valid states that are very undesirable (e.g. pegs breaking, manipulation of prices to liquidate positions) this one would be a peg breaking that subsequently would trigger a cascade of liquidations, at the current state of solana that would also flood the network in people racing to try and grab the liquidation fees[1] [1]: (a quirk of all of the smart contract platforms I know is that there is no way to ensure that X happens under Y conditions, so instead what people do is set up there systems such that if Y there exists riskless profit for anyone who can make X happen. So once collateralized positions become undercollateralized (e.g. backed by 1.1x) anyone that can return the lended assets (which need to be liquid & fungible) gets the collateral)