Because they get paid.
Does blindfold chess improve your game at all?

It might improve your game if visualization is a weak area for you... but also if this is true then you won't be able to make it through a full game anyway so... maybe not the most enjoyable way to practice (e.g. why not do puzzles or play long games).
Once you can play a whole game blindfolded (probably even before that point) I don't imagine it being a very useful exercise.

I see two main benefits to being able to play blindfold chess:
a) All OTB chess analysis is basically an exercise in blindfold chess. So being able to play an entire game blindfolded helps the player to verify his own analysis
b) By learning to play entire games blindfolded, it gives the player the confidence to analyse his games more completely.
Since chess is basically the art of analysis, being able to play blindfold chess definitely helps most players. Botvinnik and others worried about damage to mental health due to playing blindfold chess. But that threat is no greater than any other form of chess activity.

Blindfold is extremely useful, BUT only do it if you are 1900+. Else its a little too difficult. To answer the question, it helps you train visualization and helps you get a "hang of the board."

I’m playing exclusively with blindfold pieces / rapid on chess.com, and normal rapid on lichess. A few things… my rating is plummeting in chess.com (obviously!) but it’s been improving consistently on lichess. Also I get that the setting isn’t true blindfold (I see a board) but with my rating that’s a good intermediate step. When I can consistently win timed games like this and increase a rating then I’ll consider actually going full blindfold.
How it helps… For my rating I’m pretty good at tactics and visualization. So when the time comes to think things through and find the best move, I can usually do that in a game.
How it does not help - long-term strategy, creating imbalances, thinking critically of your opponents moves. … in some ways it’s cool to have this intense mental weight the whole time you’re playing and then normal chess feels easier. But blindfold chess is no substitute for other forms of study and improvement. It is only a supplement. I’d say a very strong one.
It also helps with mental fortitude and then psychological aspect of the game. Because from move 1 you accept that it’s a disadvantage that you need to cope with. And in normal chess often our opponents can create disadvantages that we’ll work with on the board as long as we’re psychologically strong.
Does it make your chess better? If not, why do people play it...
(Rather then "it's fun")