The knowledge factor operates just like an old-fashioned password. Authors select this factor to add a password, PIN or challenge phrase to the share that the recipient must provide to access. Authors can change the knowledge factor later for existing/sent shares and those rules take effect in real time, just like adjustments to time, location or biometric.
Simply tap the control and the keyboard will launch to enter the alpha-numeric entry. If you want to skip the challenge, click "DONE" to escape the keyboard and then exit to return to the main share edit window.
Tapping the factor lets you see what passphrase you set if forgotten and allows editing. Long-pressing the factor erases the challenge and clears that factor for the given share.