What is animation? Animation means to bring the character to life. There are of course different possibilities to do that.
Bones will be placed like bones/joints in the body. A human arm for example has a upper-arm-bone (consisting of ulna and radius) and the hand with all of its bones. For a not so complex animation you can use only 3 bones. The coresponding CPs will be assigned to the bones. When the bone moves or rotates around a joint, the CPs will move corresponding to the bone.
Skin-Animation or CP- or Vertex-Animation means, that the points itself will be animated without the help of bones or other helper objects. That sounds more or less primitive but it has its advantages too. For example if some simple details which only will be animated once, it is often not needed to animation it with bones.