How does this work exactly?
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It’s a nip46 signer. Key stays in clave and clients request that clave sign on your behalf. So you can test out any number of Nostr clients without handing over your nsec to each of them.

GitHub
clave/FAQ.md at main · DocNR/clave
Push-based iOS NIP-46 Nostr remote signer. Wakes a Notification Service Extension via APNs to sign events in the background. - DocNR/clave

Clave
Clave — Nostr remote signer for iOS
Sign every Nostr event without exposing your keys. Your nsec stays on your iPhone in the iOS Keychain — device-only, never synced or backed up.