What is Smart Tethering and how does it work?

It is a method of reducing the current consumption of the Bluetooth chip by selectively activating Bluetooth Tethering only when i’m Watch needs it. The battery thereby lasts much longer both on i’m Watch and on the smartphone. iPhone users also obtain another benefit from Smart Tethering: by activating the connection to the Personal Hotspot when necessary, the iPhone will be able to use the Wi-Fi connection even when connected to i’m Watch.