What I saw was people talking about how lots of apps check what type of content is on the clipboard in order to adjust what they show the user (e.g. if the user has a photo on their clipboard make it easy for them to attach it). At least at the time I saw the post about this there was no evidence TikTok was actually harvesting the copied data itself.

And what exactly would they want with arbitrary passwords anyway? Using them would basically destroy their business as soon as anyone figured it out, and selling them would not remotely be worth the risk.