

Couple things there.
There are Virtual Game Cards, purchased and downloaded digitally from the eShop. These can now be traded, sold, gifted, loaned, etc. to other friends, which was not previously possible. (This could possibly require an NSO subscription, but I’m not clear if that’s true at all.)
There are physical game cartridges, which contain the actual game on them, and (from what I’ve heard) most games will be distributed this way.
Then, there are also physical carts that contain only the virtual game license file, thus that you have to possess the physical cart in order to download or play the game. Apparently, there are Switch 1 games like this already, but they are rare.
With the introduction of Virtual Game Cards, it is no longer possible (even on Switch 1) to play more than one copy of a game online at the same time, even with a min NSO Family subscription.
It’s like a virtual license file for a game. It’s basically the same system as before but now you can trade them with people on your friends lists.
People with kids: be sure to set parental controls on this before your kids are bullied into sending away all the games you bought them
WDIT: I see the article is not actually about the virtual key cards but the physical ones. This is a game cert without the game on it, just the license file. You still have to download it.
Honestly I think that fucking sucks because they can just take it away from you.