We saw it just a few weeks ago after what can only be described as a run on the Terra ecosystem, when  Promising 20% Interest on Stablecoin Deposits Raises Concerns,” Bloomberg, March 23, 2022, https://www.bloomberg.com/news/articles/2022-03-23/terra-s-promise-of-20-defi-return-raises-sustainabilityconcern. 5 everyday users were seeking restitution and even experienced DeFi players were discussing ways to compensate retail investors.
Such diversification would thus pose much less systemic risk, largely because of lowered leverage, which in turn is the consequence of the private-market discipline imposed on commercial and investment banks, mutual funds, insurance companies, and other current or potential holders of mortgage-backed securities.