Thank you for playing! Crafting can give you some stats upgrades, like increasing the damage of your attacks (the wrench upgrade) making you faster (the boot upgrade) or increasing your max HP (the shield), also restoring your health.
On the second screen it is intended for the arrows to do that so the player jumps over them with the dash so they know they don't get damage while on the air (you can kill the enemy that spawns those arrows).