The text describes how the Nostrum protocol works when someone mentions another user's handle in a message. The mention could be either a direct link to their profile or a `nostr:` URL which contains the user's handle and a public key. When Carol sees this message, her client will first display the `.content` as it is but later it will parse the `.content` and see if there is a `nostr:` URL in there. If there is, it will decode it, extract the public key from it (and possibly relay hints), fetch that profile from its internal database or relays, then replace the full URL with the name `@mattn`, with a link to the internal page view for that profile.

Link: https://github.com/nostr-protocol/nips/blob/master/27.md