The white stuff (probably Satanite) is being used as a thermal blanket, which causes the steel to cool down at a slower rate than it otherwise would in air. Wieringa does this to the blade at an orange heat, indicating that this is a lamellar anneal. He does it twice in the video, once to soften the steel before machining (lowering its wear resistance), and a second time as a form of stress relief before the quench. In other words, to help discourage the steel from warping during his next stage: hardening.
This is because, as Hoss said in the other thread:
The most common conditions to quench from are ferrite, pearlite, martensite, or tempered martensite. The best condition to quench from is tempered martensite. It also has the most distortion after the quench causing the most risk.
In the video, Wieringa is going from stress-relieved coarse pearlite → austenite → martensite... although it's possible he didn't show every step.
As Dan mentioned, the first time he does it, it kinda doubles up as a normalising cycle. The second anneal doubles up as a grain refinement cycle.
You can see Kato going through the same annealing process in this video (at 5:20):
[video=youtube;TgtFgJR-U_E]https://www.youtube.com/watch?v=TgtFgJR-U_E[/video]
Although they are both lamellar annealing, it's interesting to note that the steel, the methods and equipment used - as well as their reasons for doing it - are all different.
