Difference between adding a miniconda python interpreter via "Conda Environment" and "System Interpreter"

Hi,
I'd appreciate some help in clarifying if I've understood the options for adding a python interpreter correctly with miniconda:
- If I add the interpreter under "Conda Environment", the interpreter is specific to projects created in that miniconda environment.
- If I add the interpreter under "System Interpreter", the interpreter will be used as a default across all projects.

If this is not accurate, could you help to clarify the difference between adding a miniconda python interpreter via "Conda Environment" and "System Interpreter"?

Thanks!