Current interest rates are the proof that your theory is completely wrong. Unless dropping bitcoin prices drastically decrease default risk, which is absurd, because the reverse is true (margin call cascade risk).
That's probably actually true to some extend. Less valuable Bitcoins are less attractive to steal. But anyway, dropping rates typically do not cause less default risk. But models are typically not perfect either. But is it wrong if it is not completely accurate? Every economist alive will guarantee you that these rates are not without (significant) risks of losing it all or a large part of it. The derived risk was high and it still is, so this hasn't changed much at all.