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www.blocklist.de is a free and voluntary service provided by a Fraud/Abuse-specialist, whose servers are often attacked on SSH-, Mail-Login-, FTP-, Webserver- and other services. The mission is to report all attacks to the abuse deparments of the infected PCs/servers to ensure that the responsible provider can inform the customer about the infection and disable them. Fail2ban is a tool that scans log files and bans IPs that show the malicious signs -- too many password failures, seeking for exploits, etc. Generally Fail2Ban is then used to update firewall rules to reject the IP addresses for a specified amount of time, although any arbitrary other action (e.g. sending an email) could also be configured. Out of the box Fail2Ban comes with filters for various services (apache, courier, ssh, etc).
IP in these lists are used to perform all kind of attacks to end user services. Sometimes these attacks can be stopped blocking full access to a website with a firewall, but a fine grained access control at application level can be necessary.