It's clearly intended to be used as bait for phone snatchers. That iPhone dangling loose a foot below your arm in free air is just too tempting… no thief can resist. But, then! You start swinging that motherf*cker, and your iPhone becomes a deadly weapon before any potential thief has time to think.
Third parties are sure to fill the market with the most obvious additions, e.g. metal spikes, studs, mildly poison-laced hooks. I assume there will also be training courses scheduled in Apple Stores around the world to clarify this accessory's purpose — not to mention, to teach proper technique and the ethical considerations of when to stop striking with the iPhone Pocket to avoid manslaughter charges in your region.
This is a move by Apple to subtly promote armed, deceptive martial arts as self-defence. To promote the Bushido spirit as a practical coping mechanism in these stressful times, and to empower its users in everyday situations. I for one think it's Insanely Great, and right on that bold frontier of innovation and Thinking Different that Apple built its reputation on.