The main problem this project is trying to mitigate is the password reuse. If user A uses the same password for a lot of sites, a malicious person B is able to convince A to join a new service, like a cat photo sharing app or something like that. If A uses his/her same usual password, B automatically gets access to all A's accounts.

The way this project tries to solve the problem is by hashing the password from the client side so that sites never get the real password, but a hash instead. As other commenters have pointed out, this is not entirely effective because the attacker still can crack the hash. It just makes the problem more difficult depending on the size of the original password.

The real solution to this problem is to stop sharing password at all. Use a password manager for that purpose.