They work by pressing down on your chest and compacting it. It makes your chest look flatter and they could make your chest and back hurt but it's worth it to alleviate the dysphoria
Binders work by providing an equal amount of pressure to your chest area to minimize the appearance of biologically female breasts. They look like a tank top, but are supposed to be quite snug fitting. Generally, when you wear one, the breasts get flattened and somewhat pushed out towards your armpits (depends on your size). Binders are much safer than elastic bandages which can really mess up your ribs. However, binders do have their risks as well. They can cause back pain, overheating, in some cases rib fractures, and shortness of breath. But, if you manage the amount of time you spend in one, you shouldn't have any issues. Always start out slowly, wearing for just an hour or two before building up to hours. Never sleep in one. If you're at home alone just relaxing or something, give your body a break, if possible. Psychological affects on your body for trans persons are extremely positive and lessen body dysphoria. So they are positive if used correctly.