The server is balanced to give new players a chance, but also have enough of a challenge for players looking for a challenge. Mobs get tougher the further from spawn and will usually drop more items. PvP is also enabled server wide, and players can place bounties on others to claim. Siege Wars are a method for towns to battle as well to promote diplomacy and warfare.
A really hostile dude
PvP logging is automatically enabled for everyone, meaning you cannot log out, use commands, or spawn kill without being punished. Doing so will automatically kill you and drop your items. You also cannot /back after directly dying from another player. All players do start with a 4 hour grace period to ensure they can build up a respectable base. Towns should also encourage new players to join and create their own allies for the benefit of Towny Resources.