The Blinds filter allows you to remove bands of your image at regular intervals, giving the blinds-like efect.
The color of the "slats" of the blind is defined by the background color in the toolbox. If you'd prefer the slats to be transparent you first need to add an Alpha channel (from the layers dialog menu), and then click the Transparent check box.
Altering the displacement changes the height (or width depending on the option selected in Orientation) of each slat. The Num Segments slider defines how many slats are in the blind. These slats are distributed evenly over the selection.