The Rebalancing pool serves as a yield-generating vault for fETH, deriving attractive returns (in wstETH!) from the staking rewards of the reserve. Should the quantity of minted fETH ever exceed xETH by a significant margin (when CR<130%, please see the whitepaper for details), fETH held in this vault can be automatically converted into stETH. When necessary, the protocol redeems only the required amount of fETH to restore stability, with fETH sourced proportionally from all depositors.
TL;DR: Deposit fETH to Rebalancing Pool to farm high stETH yields and may periodically DCA into stETH