During Rio 2016 Olympic diving events it is easy to observe the athletes prepare with a wet small towel both before and after the dive.
After the dive this towel is promptly launched into the pool.
What would be the reason for this?
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It would appear that what you're talking about is a Shammy, or aqua towel.
Aqua towels are super absorbent towels that wick water away from divers' bodies. Divers use aqua towels because they are able to wring water out of them quickly, dive, and then use it again, because nobody likes drying off with a wet, damp, cold towel!
BEFORE the dive, Swimmers will throw their towel in the pool to judge how far away the water is, because the water is clear.
Swimmers will throw towels in the pool AFTER the dive in a sign of resignation, anger, or quitting.