Captain Bluecrab is one of the pirate leaders who led the raid upon the Kraken Isles.
While walking towards you, he will set traps on the ground: if you're trapped in them, you will lose a lot of health, and you will see your character losing a lot of blood.
After being killed there, the entrance to The Dragon's Jewel is open.
He is quite difficult to kill, so you need to be in a party in order to kill him.
A good tactic for rogues or mages is to just stay back to the boss. Warriors can charge in and take the damage