Xsettingsd is a lightweight xsettings daemon which provides settings to Xorg applications via the XSETTINGS specification when not running one (like when using KDE). Some applications like Java or Wine does not get the font settings through so this is necessary to provide setting like anti-aliasing and font hinting.
See https://github.com/derat/xsettingsd/wiki/Settings for detailed syntax.
An example configuration to provide better font rendering:
Xft/Hinting 1 Xft/HintStyle "hintslight" Xft/Antialias 1 Xft/RGBA "rgb"