Or something old and understood is happening. Tragedy of the Commons? The same behavior that causes traffic jams? (If everyone slowed down and evened traffic out, there wouldn't be waves leading to a cascading stoppage.)

You are right if it's only a single business failing. However, even JPM or BofA won't survive if >25% of their customer deposits are withdrawn in a matter of days, let alone other smaller banks.

If 100% of businesses in a certain sector are a "failure" according to your definition, then I suggest your definition is wrong.