If another company transfers a domain to me and they neglect to change the nameserver to Cloudflare’s before the TAG, the domain is in limbo and it causes all sorts of problems.
Why is it essential for the nameservers to be changed before the domain is eligible for transfer. This isn’t the case with any other registrar as far as I know.
I believe this is because Cloudflare Registrar is meant as an add-on product for domains that already use Cloudflare’s authoritative DNS. Once the domain has been transferred to Cloudflare Registrar, you will be unable to change the name servers away from Cloudflare’s authoritative DNS. Therefore, Cloudflare requires that the domain uses Cloudflare’s DNS before it is transferred to ensure this does not break the website. After all, reverting a name server change is much easier than a domain transfer.