VMware recommends that ESXi has a persistent scratch location available for storing temporary data including logs, diagnostic information, and system swap. (However, this is not a requirement) Persistent scratch space may be provisioned on a FAT 16, VMFS, or NFS partition accessible by the ESXi host.
Note: Pointing the scratch location to a partition on an SD card or USB stick is not recommended. These devices only have a limited amount of read/write cycles. Since we not longer throttle the I/O for the scratch location, this amount can be quickly exhausted, which does impose the risk of the whole device, including the boot partitions it holds, getting corrupted with out being recoverable.
https://kb.vmware.com/s/article/1033696