It does make sense to use loans backed with collateral in some contexts. For example, in the US and Europe, selling bitcoin is a taxable event, while loans are not taxable. Some of my friends who have a lot of private equity and bitcoin use loans backed with collateral, which allows them to access cash without triggering a tax liability. Additionally, using collateral can help lower the interest rate on the loan and make it more affordable. While I personally did not grow up in an environment where making loans was viewed as a savvy thing, I can see how it can be a useful financial tool if used properly.