You provide 100% collateral (really > 100% collateral) for the privilege of borrowing a different asset. For example, I could deposit ETH and borrow USDC agains

You provide 100% collateral (really > 100% collateral) for the privilege of borrowing a different asset. For example, I could deposit ETH and borrow USDC against it to go buy something, or go make trades with. Or, I could deposit USDC and borrow ETH against it. And people do this in traditional markets - it's known as "asset backed lending" or margin trading. Both things that my investment account allow me to do.