I personally don't know the facts, but they claim that it pulls heat away and down the pipes to help keep your engine cooler or something like that. I did it to my old cafe because the pipes looked bad and it was cheaper than getting new ones. Make sure you wear think rubber gloves and a particle respirator, you definitely don't want to breath that glass in while wrapping your pipes. It will also look better if you have someone help you.
However, it does promote rust because it retains the moisture, so rusty pipes will only get rustier.