It contains solvents and a resin and I'm sure it hardens wood. To what extent it also waterproofs the wood is a different question, which can only be determined by experience. I call the coating over raw wood "undercoating" and it has 2 functions. First, it seals the wood grain so it will not rise when you paint the lure with water based acrylic paint. Second, it is a durable waterproof layer which, along with the topcoat, protects the lure from water penetration. I use epoxy, propionate, or UV cured polyester resin (Solarez) as undercoatings. Other guys call it "sealer" or "primer" and it confuses the issue to me. I think a sealer's function is only preventing grain from rising, and I think of primer as a paint adhesion coating.
Another issue to consider is whether the Minwax will be compatible with the paint and topcoat you use over it. Most undercoat products are OK with acrylic paint, but paint containing solvent might not be. If it isn't, you may see fisheyes in the paint. Topcoats containing solvent are often very selective about compatibility with particular undercoatings. All of us use a "devil's brew" of undercoatings, paint, and topcoats. None of them were specifically designed to work together so we can only try different sets of coatings and see if they work or fail.