To be able to communicate with the Monero network your wallet needs to be connected to a Monero node. For best privacy it's recommended to run your own node.
This mode will use a remote node whilst also syncing the blockchain. This is different from the first menu option (Simple mode), since it will only use the remote node until the blockchain is fully synced locally. It is a reasonable tradeoff for most people who care about privacy but also want the convenience of an automatic fallback option.
