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Yes, it means what you think it means, though "discussing the possibility" does not mean "trying to prove".

Weirder Arxiv papers exist, it's not that odd.

No, you read it wrong. They are not trying to prove anything, they are discussing the possible origins of the object.

Anyone can publish to Arxiv; one doesn't need to be credible to publish there. I am not saying these authors are untrustworthy, by the way, or that the object in question is or is not of alien & artificial origin; I am saying that anyone can publish a paper to Arxiv.

nope. from personal experience trying, you need two endorsements.

They are attached to an institution however.