I just stumbled onto this issue. This is horrific and breaks one of the main reasons I updated. This is a really dumb archaic rule and needs to be changed to enable vm's to sign into icloud.

As many others have stated this limitation is strange and does not make sense. It defeats the purpose of having a vm as long as many/most apps are only in the app store. And while syncing certain items like keychain can only occur in icloud. The use cases for running vm's that can access the app store and icloud are many. There are developers who use it, support admins who use it, and many home users. From sandboxing an unknown app to having a different desktop configuration on your machine with out having to reboot. I have used this feature for years both personally and at my jobs. It makes it easy to spin up a system that is pristine for testing and you don't have to care about the clutter left behind. You can snap shot them, back them up, and migrate them from one Mac to another one. They really are so versatile and with the speeds of the M series laptops I would say for the first time in a long time able to run at speeds that are enticing all around. I would hope that Apple would reverse this decision or that the community will do what they do and find a work around that will enable this very basic feature set..

I am also looking to do testing and other things like that on a vm. I am confused why a MacOS guest vm running under Intel could sign into icloud completely and a MacOS guest vm running under Apple Silicon can't. I know that there was a change with the implementation of the virtualization framework but not understanding why some parts were or still are locked out. That being said the current status of the Apple ID in a MacOS guest under Apple Silicon is almost complete for my use cases. The only things missing are the ability to sign into the app store (many MacOS apps are only available there), and for nested virtualization. If those two were fixed all of my uses would be set. I hope that these features are coming soon.