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EricHiggin said:

The transfer speed from a slow internal NVMe to on board NVMe should be remarkably faster than external USB 3.0 (HDD) to on board NVMe. It would also allow for a much cleaner look not having a separate external drive.

Certainly if you have such an SSD lying around already, that's a reasonable solution if you are OK with copying games back and forth
when you want to play game you haven't touched recently, with notably faster copy speeds than just a HDD, even if not full PS5 spec.