It doesn't, what you see when you display the content is only 1/2 of it, the other half is how the system is able to store the content through delta-compression.

Here "text" or "binary" is a bit of a red herring, what's really important is whether it's diff-able. But in 99% of cases "binary" and "text" are synonyms for "un-diffable" and "diffable".