I've never seen a "I will paste your clipboard for you" feature be used in any app, ever.

Discord and other apps will paste in one-time codes from the clipboard. Copy code from an authenticator app and switch back to the app. The code gets auto-pasted into the box.

It's pretty handy since paste itself is a somewhat cumbersome shortcut on many keyboardless devices.

A dictionary app I use looks at the clipboard when opened and automatically displays a translation iff 1) the copied text is new compared to the previous time the app was used; and 2) the text is in the source language.

It's a pretty neat use of the feature, although I'd still gladly let go of it if it means that the other 20 apps I regularly use don't get to rummage through my clipboard for no good reason.

I like parcel tracking apps detecting a tracking number in clipboard

Is it also fine that tracking apps read all your passwords in the clipboard?

Agreed that this downside is not worth the convenience. But, I think iOS 14 provides a great solution to this problem; you can pattern match against the contents of the clipboard without reading the contents. Then you can always read it if it matches.

One I use regularly is that Chrome on iOS does it when you open a new tab. It offers to search for the text in clipboard or go to the URL if it's URL format.

The Apollo for Reddit app checks if you have a Reddit URL in the clipboard and proposes to open it if so.