Parallels Desktop 20.2 is out now, with the latest edition including 64-bit x86 emulation for Apple Silicon and more enhancements to make Apple Intelligence Writing Tools work with Windows apps.
Using a proprietary emulation engine, it allows Apple Silicon Macs to run x86_64 virtual machines, for Windows 10, Windows 11, and Linux.
While support for Apple Silicon has been around since Parallels Desktop 16.5, it has been limited in not having x86 emulation support until this update.
The big addition is an early technology preview of x86 emulation for Apple Silicon Macs.
Lastly, Parallels Hypervisor can't be used, with the VMs needing to be booted via Apple's version.