It's mostly an experiment into providing an integrated interface leveraging Haskell features (type-safety, STM, etc.) for the whole system: input, display, sound, network, etc. There is still a lot of work to do...

Then in a probably far future I would like to use it to try different (crazy) things. For instance configuring the whole system with type-checked Haskell code (similar to XMonad configuration but for the whole system); provide a better terminal-like interface/protocol replacing stdin/stdout/stderr/term ioctls; generalize Linux sandboxing to all applications (filter syscalls, use namespaces, disk quota, etc.) and manage per-application permissions; etc.

The closest approach is Android which also uses the Linux kernel but doesn't provide a Unix interface to applications.

Obviously I can't speak for the developers, but as it says a full Linux userspace, I will try spell it out - the userspace consists basically of almost anything you can install in Debian. So

* GNU tools (ls, tail, bash, gdb, etc.)

* OS infrastructure (Systemd, Xorg/Wayland, etc.; probably not Mesa/DRM though as he says he doesn't want to do drivers)

* Desktop environments (KDE, GNOME, etc.)

* ... random other packages like Nethack ...

Honestly the goal seems kind of insane, like Don Quixote trying to reach the unreachable star. But I guess it's good advertising for the consulting work, and of course research projects generate useful side benefits. And writing software in Haskell is fun, so they just might succeed :-)