While I am far from an expert on the topic, and certainly have no idea of any metallurgical properties of the stuff, Mokume (I believe it's more properly called Mokume-gane? Somebody enlighten me) is, essentially, a form of Damascus which is created by using various precious metals, instead of steels.
The end result is a very beautiful stock, which can be ground, filed, or etched to reveal the various layers of colour. For a stunning visual display of the effects, check out
www.mokume-gane.com and look at some of the rings done in this metal.
As for its uses, I am woefully undereducated. I assume that it had its place in amongst the furniture for Katana and the other Japanese blades, but I don't know if it was used for habaki, menuki, or what. I can imagine that it would make a fabulous tsuba, for a presentation piece, but I suspect that it might not hold up well to the constant use. Anybody out there have a clearer view?
Hope this helps.
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