Damage Types - Terasology/TutorialAssetSystem GitHub Wiki
Items can do different kinds of damage. Imagine a hammer doing blunt damage which is great for smashing rocks while a scissor does sharp damage to get your tiny flowers in good shape.
Damage types are defined as prefabs, some of them are predefined in the engine at assets/prefabs/damageTypes
Most interesting for us is the materialDamageMultiplier
from BlockDamageModifierComponent
which increases the items block damage for a given material.