Humans need cholesterol from animal foods
The liver synthesises all the cholesterol the body requires. There is no dietary requirement for it.
Cholesterol is not optional: every cell membrane depends on it, and the body uses it to make testosterone, oestrogen, cortisol, bile acids and vitamin D. Plants contain essentially none, so a vegan diet removes an entire supply of a substance the body cannot function without and leaves everything resting on internal production. Animal foods have always supplied it, and the recent dropping of official dietary cholesterol limits suggests the old warnings against eating it were overstated all along.
Cholesterol is essential: it is a component of cell membranes and a precursor for steroid hormones, bile acids and vitamin D. The body produces it endogenously, principally in the liver, in the quantities needed, and regulates synthesis in response to intake. No dietary requirement exists, which is why no recommended intake is set.
On the health side, the picture is more nuanced than either camp usually allows: dietary cholesterol raises serum cholesterol modestly and with considerable individual variation, while saturated fat intake has a larger effect. Several countries have moved away from a fixed numerical cap on dietary cholesterol, which is sometimes reported as an all-clear; the accompanying advice has generally remained to keep intake low.
Presenting two options as though they were the only ones available when further options exist. Also called a false dichotomy, or black-and-white thinking.
How it applies here: Assumes the nutrient must be obtained from food, when it is synthesised internally and its production is regulated according to need.