There are reasons, firstly tax advantage in that there is no capital gain from selling the cryptocurrency; the other is that you don’t lose your position on the cryptocurrency, ideally over time you can increase your borrow as the underlying collateral increases in fiat value.
One can also use the borrowed funds to speculate on other cryptocurrency, as a collateralized margin loan.
Many lending systems offer incentives too, where you can be paid to borrow.
In this case, liquidity is pooled across the Aave protocol. There's no difference in the interest rate for someone lending / borrowing $50M or $50. It's easier, but you should probably never have more than 10-20% of your portfolio in a single wallet. And probably should shrink that down even further as your net worth grows.
