Minimal Panels is a toggle, and it is off by default. You will find it behind the gear (settings) icon in the header of the floating command palette, which opens a small settings popover. It is only shown when the layout supports it.
What it does
When the setting is on, the floating panels (Explorer, Palette, Editor, and AI) are swapped for a compact button bar, a dock. Each panel then opens as a popover from its button instead of floating on the canvas. In the settings popover the hint reads: "Swap floating panels for a compact button bar."
When to use it
Minimal Panels is good for small screens, where floating panels can crowd the canvas, and for anyone who simply prefers a tidier workspace. Tap a button in the dock to open that panel as a popover, then dismiss it to give the canvas back its full width.
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