In my understanding, it means 'The enemy is trapped inside the city, while we remain out of their firing range '. AFU have surrounded Bakhmut & controls any movement in and out of the city, including reinforcements, resources, etc.
It wouldn't surprise me if the Russian generals shovelled thousands of conscripts into Bakhmut out of sheer desperation to keep their 'prize' in the face of encirclement.
It would be one way to get rid of them, assuming they don't run away if they realise it's a trap. Although I wonder what would happen to Chechnya if Kadyrov and his thugs died. Would the Chechens remain rebel at some point?