Proton is just your PGP email client + cloud sync (kind of like a password manager).

It generates a PGP key when you create an account. Then they encrypt incoming email with that key. You can replace this key if you want.

You can add PGP keys for contacts that aren't in the Proton ecosystem and they'll use those keys to encrypt out going mail and provide the information to reply using your Proton PGP key.

If your contract is another proton mail user, they set all this up automatically (they can figure that out via MX records). They've also pushed for an open standard for doing this automatically for all PGP capable MX servers (i.e. allowing the automatic key exchange to happen when emailing someone out of their ecosystem).

So what you get with Proton is a fancy PGP web client, encryption at rest server side, some niceties with automatic key exchange, and an IMAP bridge that handles all the key management outside of your mail client (which makes sure it's done right and everything is in sync across all your devices).

All the encryption and the initial key generation happens client side just like with Bitwarden.