i mean, it shouldn't be scary, because their failure is their own, and i doubt there would be collateral damage outside of those high risk investors.
It's scary for _them_, but it's an interesting case study for an outsider.
I lived through the crash of 1989, the Dot Com crash in 2000, the GFC of 2008, and whatever the crash and WSB speculation in 2020 were called. None of them had a tiny blast radius like you suggest.
To use an example, the Great Depression wasn't sunshine and roses even for the people who kept all their money under the mattress. Their job was just as likely to go out of business.