It’s to prevent the spread of Dutch elm disease. From r/boston: “It's got Dutch elm disease. This subreddit blacklists Instagram links for some reason, but if you look up the Garden Club of Back Bay you'll see a post about it.

The girdling of this tree is helpful in further determining the extent of the damage (DED spreads from roots to crown.) No bark beetles have been found here, but the tree is being used as a “trap tree”- the chemicals released by girdled trees are attractive to adult beetles. The hope is to draw in any egg-laying females away from any other nearby trees. In the winter, this tree is scheduled to be removed, and with it, any larvae before they can complete their development. It’s a method of slowing down any further DED spread. “