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I second that! Editing on an external drive is just a natural way of going about everyday work! I am sure most professionals and hobbyists alike would be happy to have it available, even at extra cost.
That
would be extremely useful and handy, especially for folks running low on storage space. Its such a common practice for desktop video editors that I would expect that if it were possible on iOS it’d have been implemented much sooner.
I could be wrong. Maybe it’s possible and even in development but if I had to guess I would say the way iOS handles file management wouldn’t allow for it because of how restrictive it is.