It's the definition of any distributed system (or even single server) where you can deploy code, whether it's Erlang or a kubernetes cluster you setup.

Is pushing new code for your server to run "arbitrary code execution"? I guess we can call it that. Is it an exploit?

Depends if the code comes from some random person on the internet from mechanisms that you don't intend for pushing new code to run (e.g. through a buffer overflow on your server or XSS), or if it comes from yourself through your official mechanisms.

"Arbitrary code execution", yes, "exploit", no. You need to be "inside" the BEAM cluster and a member of the BEAM cluster to do this. That is not something you hand off to end users, just as you do not normally hand end users direct access to your database socket or other such resources. In Raymond Chen's terminology [1], if you're sending Erlang terms to the BEAM cluster, you're already on the privileged side of the airtight hatchway.

[1]: https://devblogs.microsoft.com/oldnewthing/20060508-22/?p=31...

Only if you allow untrusted clients to join to the cluster. To really make use of something like this, you’d have to control the clients rather than opening it up to anybody on the public internet.