The # sign will flash blue when a Bluetooth signal is being registered with your Deadbolt 2S.

This may mean 3 things:

Someone is trying to Bluetooth Unlock from the igloohome app
Someone is trying to pair with the lock from the igloohome app
Someone is trying to connect with the Bluetooth ID of the lock from a normal Bluetooth screen

You may refer to this video to have a visual reference of this behavior: