It is an internal database file used to keep track of signatures for content that the distributed file system has seen. This way, given a new signature, it can generate new files based on chunks of data it already has.
Cross File RDC:
by using a special hidden
sparse file (located in drive:\system volume
information\dfsr\similaritytable_1) to track all these signatures, we
can use other similar files that we already have to build our copy of
a new file locally. Up to five of these similar files can be used. So
if an upstream server says "I have file X and here are its RDC
signatures", we the downstream server can say "ah, I don't have that
file X. But I do have files Y and Z that have some of the same
signatures, so I'll grab data from them locally and save you having to
transmit it to me over the wire."
Depending on what you are trying to do, it is safe to delete that directory and clean up the old database files. See this manual for the steps involved (and when to do so).