It actually calculates the Levenshtein distance between the legitimate address and every address in its own list. It then selects the attacker's address that is visually most similar to the original one.
This is a brilliant piece of social engineering baked right into the code. It's designed to specifically defeat the common security habit of only checking the first and last few characters of an address before confirming a transaction.
We did a full deobfuscation of the payload and analyzed this specific function. Wrote up the details here for anyone interested: https://jdstaerk.substack.com/p/we-just-found-malicious-code...
Stay safe!