i think that is just a pad eye and it would put side stress,and localized on the boom where you mount it and possibly/probably cause stress fractures/failure.
According to rigrite.com it is a boom bail. It is mounted by cutting a slot in the boom the length of the u-shaped part, then mounted on the inside of the spar. I guess it would be like having a backing plate, except there is a big slot cut in the boom. I agree, it might give the part more surface on the slot to grow stress fractures.