I have been wanting this for years
I've been using iTunes for backups, but using iCloud would be a lot more convenient if they just addressed this glaring shortcoming.
I had kind of given up hope of ever seeing it, I figured that Apple was too concerned about law enforcement backlash if they were no longer able to get an iPhone owner's data even with a warrant. This is opt-in, so probably the majority of people won't take advantage of it. But you have to think the ones who know they are a potential target of law enforcement and have at least three functioning brain cells will, and you have to know that the FBI will keep track of exactly how many cases they serve Apple with a warrant only to be told "sorry, we can't give anything because that customer's iCloud is encrypted". We'll be hearing a lot about this next year, especially with any case related to terrorism or pedophilia.
So it will be interesting to see how much backlash Apple gets. I would say they must have given this a lot of thought and are prepared for the inevitable backlash from the FBI, and talk about the need for laws mandating magic technology that allows law enforcement access without compromising security. But they obviously weren't prepared for the backlash with the CSAM scheme they had to walk back, so who knows if they are ready for the shitstorm they're going to unleash!