The dangerous thing for O'Malley isn't the loss. All fighters lose at some point. The dangerous thing for O'Malley is father time. Because as you get older, your metabolism decreases. The reason O'Malley has success is mainly due to the fact that he's fighting in bantamweight. He has a reach advantage against his opponents that makes it virtually impossible for them to strike with him in combination with very solid striking technique, and that reach advantage also makes it very difficult for grapplers to close the distance on him. But his ability to reach 136 (both he and Chito were exactly 136 at the most recent weigh-in) is mainly due to A. genetics and B. his youth.
As he gets older, his body will get thicker, it will be harder for him to cut weight as easily, it will be harder for him to maintain his weight in general. And that's fine for most people, but it might force him to change weight classes. If he has to go up to featherweight, suddenly that reach advantage is severely diminished or even nonexistent vs guys like Max Holloway, Alex Volkanovski, Zabit, etc. And the reality is that technique-wise he is not superior to other top strikers in the league, and he is not a notable grappler. So any losses he takes are big now because he's on a clock to win the bantamweight belt. If he takes a loss, and then another loss, sprinkle in some wins, doesn't get a title fight, suddenly it's 3 years later because MMA fighters naturally only fight about twice a year, and he has to move up a division, his window to become a champion has disappeared.