If you pay by PayPal, Credit Card, or Phone a reserve will automatically be applied to your account. This limits the amount you can give away while transferring or trading. It also offers you some protection if you are a victim of Phishing. Note PayByCash payments do not have any reserve.
When you buy a xats and days pack a proportion of those xats are held in reserve, unavailable for transfer or unbalanced trades (when the value of what you are trading is much greater than what you are receiving). If a transfer or unbalanced trade would cut into your reserve, you will get a message saying insufficient cleared funds and the transfer or trade will fail.
You can still use all the xats to purchase powers, exchange for days, purchase promotion etc. Over time the reserve is reduced until eventually all the xats are available. This is done to allow you to transfer some xats, days and powers to your friends or participate in unbalanced trades.
With the reserve, if someone phished your account they could only transfer out the "cleared" xats, days and powers saving you from a costly experience. If you did a high value trade, were not paying attention and didn't notice that they changed the offer at the last minute the chances are this would cut into your reserve so the trade would fail.