Credit to one of the devs (Ste) for the description here

It’s a generalized mod loader for GDScript-based Godot games.

The mod loader provides a convenient solution for users to create and distribute mods for your games in the form of zipped files/resource packs. The key feature is the ability to modify existing scripts without altering and redistributing the original game files.

Yes, we will port to Godot 4 soon. There hasn’t been any demand for it yet, since the main games using it are on 3.5

Feel free to join our discord for questions, ideas, and support. https://discord.gg/J5AvdFK4mw

Two larger godot games that are using it currently are Brotato and Dome Keeper