Apple had stopped allowing M1 Mac users from sideloading iPhone and iPad apps a few days ago. However, the company appears to have reversed the move as sideloading iPhone and iPad apps on M1 Macs works once again.
It was recently reported that Apple had enabled new server-side protections that stopped users from sideloading iPhone and iPad apps on their (relatively) new M1 Macs. Users can also install iPhone and iPad apps from the Mac App Store but not all developers have enabled the feature.

Apps tailored for iPhone & iPad
Major developers like Facebook, Google, and Microsoft do not allow the use of their made for iPhone and iPad apps to run on M1 Macs through the App Store. It makes sense as the apps have been tailored for use on touch based devices and not using traditional pointer based navigation.
However, the inability to install iPhone and iPad apps from the Mac App Store did not stop tech enthusiasts from trying to sideload iPhone and iPad apps. Apps made for the iPhone and the iPad are found on the internet with ‘.ipa’ extension. Users found that it was totally possible to install the apps on their M1 Macs using the ipa files.
Apple, on Friday, blocked the installation of iPhone and iPad apps through ways other than the Mac App Store. But it looks like the decision was made in a hurry as the company has already reversed the move. Users can now continue to install their favorite iPhone and iPad apps which are not available on the Mac App Store.
At WWDC 2020, Apple announced the move to using ARM based Apple silicon in future Macs. The company released the M1 chip, the first Apple chip for Mac, in November and it now powers the MacBook Air, the 13” base MacBook Pro, and the Mac Mini.