Videos will be marked as watched when they have been viewed up to 95%, either by reaching that point during playback or by manually adjusting the progress bar to the 95% mark.
You also have the option to manually mark videos as Watched even if it has not reached the 95% mark, simply click on Mark as Watched. This option will be changed to Watched. Click on Watched to revert the changes.
Videos that are marked as watched will have a checkmark beside the video duration.
The catalog image will also be faded.