Officially the work represents Santa Claus holding a Christmas tree in his hands but the artist has implied that it could also represent a buttplug, and that “…For me, the sculpture is also about the consumer community - as a commentary on material consumption in the Western world.”[3]
It’s some piece of art and the resemblance is intentional. Search for “Buttplug Gnome” to find out more.
LOL I thought you are joking, but it is actually called buttplug gnome: https://en.m.wikipedia.org/wiki/Santa_Claus_(sculpture)
Just put him on display I guess.