Magnets. It is always magnets.
[https://en.wikipedia.org/wiki/Hall_effect_sensor](https://en.wikipedia.org/wiki/Hall_effect_sensor)
Just to add to what others have said, a lot of bicycles use these. You enter the wheel diameter or circumference (better) into the unit and it spits out your speed. I sometimes use both but the wheel sensor can update your speed many times a second whereas GPS is usually longer than a second between updates. And like other have said it will not work consistently in thick canopy, tunnels and some urban canyons.
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