Answer:
Two-Bit hands over his switchblade simple because Dally asks for it. It is a sign of respect. Two-Bit know if Dally asks for something, he needs it.
Explanation:
Dally knew how much that knife meant to Two-Bit, and if he needed a blade bad enough to ask for it, well, he needed a blade. That was all there was to it. Two-Bit handed it over to Dally without a moment's hesitation.
