In order to "hold onto the assets" the FED actually has to buy US Treasuries when its current treasury holdings mature. The way the FED sells assets is to simply allow the treasuries to mature without buying any to replace it. The implication is that by choosing to buy or not buy treasuries, the FED can help control the US treasury interest rates which either help boost or slow down the economy as needed. The issue with holding and never selling is perpetually low interest rates which encourages people to borrow more since it is cheaper to do so (in theory stimulating growth, but in reality inflating asset prices when it goes on too long). If the FED doesn't unload its treasury holdings, interest rates stay low and capital will continue to take bigger risks to find higher yield, plus an unsustainable asset price inflation as it remains cheap to borrow money to buy assets like houses which then go up in value which creates even more demand through more cheap credit.

I'm already over simplifying, but here is a less abstract illustration: Imagine you lose your job and you need some money to get back on your feet. You borrow against a line of credit to cover living expenses. You find another job but it doesn't pay enough to cover your standard of living, so you keep the line of credit open and just make the minimum payments. You are the US economy and the line of credit is the FED right now. If the line of credit is not paid off, if you lose your job again, there will be nothing to borrow against or even make the minimum payments. The smart thing to do is pay off the credit card balance so you can use it again if you're in trouble. The problem is you can't do that unless you cut back on spending... and this is why the FED always points out that the control of the situation is not with the FED but with congress, they need to cut spending... <insert laugh track>

And I didn't even address your exact point. This is just the "non-toxic treasuries". The toxic stuff is non performing home loans. Imagine trying to sell those back to someone! Are you willing to buy them?

More info here: https://www.newyorkfed.org/markets/mbs_faq.html