Mostly I was outlining two possible extremes but there is some reality behind them. Coinbase was planning on creating a lending product but the SEC called that

Mostly I was outlining two possible extremes but there is some reality behind them. Coinbase was planning on creating a lending product but the SEC called that a security and Coinbase has delayed its plans. There are collateralized loan products already in decentralized finance apps such as Curve and MakerDAO (oasis.app). There aren't many artificial limits to what a Turing complete smart contract can do as long as it has access to the underlying information.