I paused a video in YouTube’s app for Android and got this message: “paused videos keep buffering if you leave the app”. There’s a background buffering feature and YouTube shows the how much data has been buffered. For example, “buffering 11.8/39 MB”. YouTube videos are actually cached, so that’s the reason why YouTube’s cache can become huge.
When YouTube caches the entire video, you’ll receive a notification which shows that the video is “ready to watch”.
This is useful if you have a slow Internet connection: play a YouTube video, pause it, leave the app and wait until the video is cached. Then you can watch it.