It's interesting you brought that up because crypto has a similar mechanism to get people to complete the whole transaction and resolve disputes without involving interest rates.

For example, imagine person B was buying a product from A. Should A send the product first or should B pay first.

When both sides don't want to take the initiative, they use an escrow contract on the blockchain where both sides have to lock up 150% to 200% of the value of the product in crypto inside the contract.

A then sends the product.

B receives the product.

If B accepts the state of the product, he can press a button to release the relevant amount of crypto in the contract to A and refund the extra 50% to 100% he had to put up.

If B sees the product is fraud, he presses another button and both sides lose all their crypto. This disincentives both A and B from committing fraud.

There are more nuanced conditions involved so I won't bore you with the details, but the main concept is there and it doesn't involve interest rates.

You just described escrow with extra ~steps~ risk which has nothing to do with loans unless you’re suggesting borrowers put up 150-200% of the capital they want to borrow? (!?!?)

That can't possibly be right. It would mean that if person A defrauds person B, person B would lose 150-200% of the asking price, rather than just 100% if no "crypto escrow" were used at all.

Of course, the fact that it makes it impractical to buy any kind of expensive product is merely a detail. As is the extreme cost of non-fraudulent delivery failures in this scheme.

Cryptocurrency is finance as imagined by people who have never bought anything more expensive than a car or house.