Would such a thing be possible? I know a lot of exchanges have holdings in each other's wallets. For example, Bittrex could have a store of LINK on Kucoin.
Wouldn't it make sense for centralized exchanges to utilize staking pools to increase their liquidity?
I'm a novice at understanding these technologies so I might be off here in terms of the viability of such a transaction.
I know what you're saying on the surface without thinking of the technical details sounds sensible but there are always risks.
To elaborate on this regarding pool staking, well, here you provide your asset to the pool for a fraction of the conversion fees associated with the trades of that pool.
The matter is in fact not so simple as these pools are not so well regulated, there is little transparency about how they operate and there's the general risk of these staking pools not being run professionally - so security is seriously lacking which is the main risk.
Can read more about the topic
here.