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How is a diode used to regulate voltage

Hi all, I was wondering how a diode is used to control the voltage here? Assuming the voltage coming in from the left is greater than the reference voltage provided by the potentiometer, the diode is somehow acting to ensure the voltage going out is equal to the reference voltage. How does it do this, and if I tried to create this in real life what should I watch out for when choosing a diode part?
Thanks

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