Can you? Yes. Should you? Not at anything beyond a toy scale, unless you want to pay for more RAM to ensure that your normal OLTP queries don’t take a performance hit.
I had a system that has ~600gb of blob data in bytea that could have easily been an S3 bucket + db reference. It made backups way more of a pain than necessary.
It was intentional in the design, because I wanted total consistency with a single backup for the system. It worked great for years. But as we got more and more clients, it really should have been migrated to the above design to make sure our backups could be taken / restored faster.
But there are still plenty of cases I would say BYTEA is perfectly reasonable choice.