Since our eyes are placed side by side, our field of vision is wider than it is high. It is roughly shaped like the early television screen, the corners are rounded off. But the boundaries are not sharp and shapes near the edges blur and fade off to nothing. Look at your finger a few inches in front of you, and keeping your eye fixed on that spot, slowly move the finger out of the field of vision. It does not suddenly drop off the edge of the world but gradually fades away at the periphery.
Corners are eye traps.
The second reason for keeping a irregular margin of white is that this gives the viewer the assurance that the painter is in control. That the picture didn't run all over Hell's acre. That the picture was not cropped to improve the composition or eliminate a booboo of some sort, but that the painter has a visual grip on things and was able to place the colour with assurance. Painting should not read carefulness. Too often a watercolour is a tame patchwork of smooth washed-in areas bounded by hard, even edges.