This may not be a perfect explanation, and someone please correct me if I’m wrong, but here goes.
The Librem Key is
essentially a smart card in a flash drive container. Think of it like a signet ring or an ID card. It’s a way to identify you that can’t be forged. It is not a flash drive that can store files, even though it looks like one.
From a user’s point of view, the card holds write-only memory; you can write keys to it, but you can’t read keys off of it. You can also erase the keys on it and write new ones to it, but the important part is you can never read them back off of the device. This is nice because now you can walk around with electronic keys in your pocket, plug them into any computer, and nobody can copy your key and pretend to be you.
What can you use these keys for? Several things. The first thing that comes to mind for me is encrypting emails. You can also use them to unlock your computer.
What else can it do? It can generate one-time-passwords. If you’ve ever needed to use an app or a device to generate a random set of 6 or 8 digits, the Librem Key can replace that.
That’s pretty much it, in layman’s terms. If I’ve missed anything, hopefully someone else can fill in the gaps.