Palythoa is a genus of encrusting anemones. What is special about the "classical" Palythoa is that they have a thick tissue, the so-called coenenchyma, which grows like a mat on rocks and in which the polyps are embedded - the appearance is then similar to brain corals like Favia. The genus Protopalythoa has now been declared synonymous with Palythoa, and there this tissue is less developed. Usually Palythoa are not commercially available, because they are rarely exported - at most as bycatch. Incorrectly, however, this name is commonly used for Zoanthus with large polyps, often abbreviated as "Paly". The difference between Palythoa and Zoanthus, besides the pronounced coenenchyma, is that Palythoa incorporate sand-like particles into their tissues, often making them rough to the touch. In addition, their tentacles are much more pointed. Palythoa often have high levels of the toxin named after them, palytoxin, one of the most potent non-polymeric and non-amino acid toxins found in nature. It is produced by dinoflagellates that are eaten by encrusting anemones and then accumulate it. It was first isolated from Palythoa toxica by researchers after it was known to the native people of Hawaii as limu-make-o-Hana ("death-seaweed of Hana"), where it was used to poison weapons, among other things. It is a vasoconstrictor that can affect all cells of the body and thus can have various effects.
Danger exists for the aquarist, if the palytoxin gets blood contact - over mucous membranes (mouth, eyes...) or open wounds. Therefore you should wear gloves when handling and especially when fragmenting Palythoa and other encrusting anemones, especially if you have open wounds, and if necessary also protective goggles, because the polyps may spit out water. It is best to avoid mechanically damaging or removing the encrusting anemones, and also to refrain from boiling heavily covered objects (unless you like poisonous water vapor).
That one should not eat the animals or put them "where the sun does not shine" hopefully does not have to be mentioned? Palythoa make low demands on water quality and have the potential to proliferate heavily, which is something to keep in mind when placing them. They like nutrient rich water, medium to strong lighting, and strong current.