The Critical Hammer of Bug-Crushing is a weapon that is awarded to any Blacksmith who fixes a bug labelled "priority: critical" on GitHub.
It was announced on February 7, 2014.
It is currently one of only a handful of animated items in the game (the others being the Backer and Contributor rewards).
A Blacksmith who is trying to earn the Hammer by fixing one of the "priority: critical" issues should first comment on the issue to ask if it is appropriate for them to work on it. Such issues are exceedingly rare.