Here's the quote from the guy that discovered it in the initial public disclosure [1]:
After observing a few odd symptoms around liblzma (part of the xz package) on Debian sid installations over the last weeks (logins with ssh taking a lot of CPU, valgrind errors) I figured out the answer. The upstream xz repository and the xz tarballs have been backdoored. At first I thought this was a compromise of debian's package, but it turns out to be upstream. One portion of the backdoor is *solely in the distributed tarballs* and debian's import of the tarball ... it is also present in the tarballs for 5.6.0 and 5.6.1.
[1]: https://www.openwall.com/lists/oss-security/2024/03/29/4