It will not deteriorate, turn mouldy or rot. The pH, colour and chemical composition of vermiculite will vary depending on the source from deposits around the world. Horticultural vermiculite has the excellent property of improving soil aeration while retaining moisture. Some tarantulas, especially arboreal species don't like it as it tends to stick to their feet. To me it looks like peat, works like peat, and I have had no problems with eggs or other pests.
Moisture retention is almost to good.
You have to be careful not to get it to wet or your tank will rain for a month. My burrowers have no problems and quickly build tunnels. Hope this helps. I've never really had a burrow collapse - the tarantulas always seem to web all over the inside enough to hold it together. So you see there are a number of possible substrates for your charges.