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Pounce ultimately derives from the Latin for pumice via the old French word "ponce". It is a fine powder, most often made from powdered cuttlefish bone that was used both to dry ink and to sprinkle on a rough writing surface to make it smooth enough for writing. This last was certainly needed if the paper came "unsized", that is lacking the thin gelatinous material used to fill the surface of the paper and make it smooth enough for writing with a quill or a steel nib.
Although some people claim that pounce was never added afterwards to dry ink, this probably represents confusion between the two processes of preparing paper and drying the ink after writing. Experiment shows that using pounce does indeed smooth "unsized" paper but then does little or nothing to dry the ink after you have written on that prepared paper, and it is clearly the case that pouncing or sanding continued long after properly "sized" writing paper came into general use during the nineteenth century.
The pounce or sand is gently sprinkled all over the writing on the paper. When using a quill or a steel nib, and with inks that are made up to match those typically in use during the 18th or 19th centuries, and provided the pen has been used with the fine strokes typical of handwriting of that period, the handwriting will be sufficiently dry within 10 seconds to allow the paper to be folded without blotting. Gently vibrating the paper whilst the pounce or sand is on it ensures that little or no pounce or sand sticks to the handwriting and excess sand or pounce is shaken off before folding the paper.
In the 19th century the pounce pots or sanders often had a shallow dish round the top so that pounce or sand could be returned to the pot and reused. The process is very effective for quickly drying ink, and although blotting paper has been available since Tudor times, pounce or sand continued to be used throughout the nineteenth century because it was often cheaper.