It's less direct than that. Some crypto fund has say 10M$, they want to buy a lot of BTC, so they borrow 20M$ denominated in USD but settled in USDT from iFinex

It's less direct than that. Some crypto fund has say 10M$, they want to buy a lot of BTC, so they borrow 20M$ denominated in USD but settled in USDT from iFinex treasury, and use it to buy BTC. iFinex can now claim that they are backed by USD assets, crypto fund effectively has taken a leveraged BTC long position, pushing BTC up, everybody is happy. Until BTC goes down too much or everybody tries to withdraw USDT, or both, then everything unravels. You can also replace "crypto fund" by any crypto project that uses leverage to deliver extraordinary returns - as long as everything goes up.