Challenge Dungeons are designed to test players’ skills, reflexes, and endurance in a single run, with defeat sending them back to the beginning of the dungeon.
Mob bosses, contrary to normal bosses, respawn some time after having been killed. They also drop some of the most interesting and powerful loot and accessories in the game, including items needed for sidequests and other cool things. In the case of the Challenge Dungeons, you’ll have the opportunity to run through the dungeon multiple times to get new loot from the mob boss.