Explain path: 'path-to.svg' meaning

[MHillier98]

The README says:

const result = optimize(svgString, {
  path: 'path-to.svg', // recommended
  multipass: true, // all other config fields are available here
});

But I can't seem to find any docs or explanation of what this path: 'path-to.svg' parameter does or why it's recommended.
It would be helpful to know what this is exactly and why it's recommended :)

[KTibow]

I think it's only used in prefixIds to determine the prefix, but you can add your own plugins that may use it as context