Lots of things can happen to the cash in your account between the time you hit buy and when that cash finishes transferring to DTC. DTC is trying to guarantee that the person selling the stock that you are buying is going to get their money. DTC does that by telling Robinhood to have collateral in case something happens to the cash that you are using to buy the stock. Something like Robinhood going bankrupt, for example.

Because what happens if Robinhood can't, for whatever reason, put up the cash for the buy transaction? Some one still has to pay up. The problem is that eventually these failures start piling up moving up the system until eventually the government has to step in and hand out bailouts again. Collateral is a way of trying to prevent that. If Robinhood goes bankrupt, and they're dealing with this highly volatile stock, well at least they have enough collateral to cover transactions and the failure stops with Robinhood instead of moving up the system.

This is all info I've gathered from reading around and I'm not an expert. Please anyone feel free to correct anything I'm saying.

Also you kinda saw a hint of this when there was that Robinhood bug with infinite leverage. People turned $5,000 into tens of thousands via the glitch, and at the end of it all, Robinhood was one the that had to pay up for these glitches. Then they had to start hunting people down to try and recover the debt.

Someone, at the end of the day, is going to pay for any of these transactions. DTC is just trying to ensure that the bag holder stops with Robinhood.