It swaps the active slot of the firmware back to the previous version.
If you are looking to play older versions of games (rather than the system firmware), there are safe methods: ps4 tool downgrade v100 download better
Go to > System > System Information on your PS4 to see your exact system software version. It swaps the active slot of the firmware
For those serious about downgrading from 10.00 or higher, you need a hardware programmer. ps4 tool downgrade v100 download better
As of right now, the scene relies on specific firmware thresholds:
How to Revert the PS4 to a Previous Firmware (Full Tutorial)