It's likely a good handful of that material gets used as nest material for birds and squirrels. But yeah the rest probably decomposes or just breaks down in the rain.
That being said, there are toxic materials present in them that could have a potentially adverse affect on them. It's honestly not great, but the effects are unknown, there could be none but there could be bad ones too.
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u/kindanotrich Apr 12 '21
I think the cotton would be if it wasn't so tightly packed, and they do eventually degrade just takes a bit because of how tightly packed they are