This Wave bot is installed by adding a Wave extension first. Just hit this wave and 'install':

https://wave.google.com/wave/#restored:wave:googlewave.com!w%252B5uyPgy_sJ

Once installed, you should see a heart button on the button-bar when editing a blip.

Simply highlight a single word, then click the heart button. After 5-10 seconds, the bot will insert a definition from Wordnik.