They are a secret mechanism put in place by senpai-sensei in order to keep everyone in check. They can secretly make you weaker as well as stronger. The more levels you have, the stronger you can become, but the drawback is even bigger. I can tell you from personal experience, i once battled senpai on even terms, senpai was a level 100 Kitsune, and i was a level 69 akame from night raid with a 31 level boost thanks to murasam (my sword) we battled for weeks and months without breaking a sweat, finally when we were about to approach a years time, i was able to defeat kitsune san, but upon my victory, i fainted... after weaking up, i had lost my murasame, aswell as my level. I will defeat senpai once more and become a full fledge level 200, prepare yourselfs.