Both!
I rub the excess into my knees. Don't know if that does any good, but I have the feeling it's also something of a lubricant. It makes my socks give off a strange sweet smell but I've got used to it
ps- I've just noticed that it's recommended on the 'veloplus' mountain biker website (can't imagine what mb's use it for) and it's also on the top 10 list of things to put in the rucksack for the dedictaded pilgrim's 800kms walk along the jakobsweg...