Yes it's possible to build ad blockers on Safari using the Apple content blocker API. Support was also added for Web extensions in iOS 15 and macOS Monterey.
The web extension support is what enabled us to deploy complete YouTube ad blocking on iOS in Safari – previously it wasn't possible to do this reliably just with the content blocker API.
On iOS, Firefox Focus (a single tab browser) comes with a content blocker. Hush is another good content blocker. Of course, Magic Lasso (free or paid).
I've only experienced the dictatorial context of Chrome on Android, so would never have fathomed something like this would ever pass policy. Hence I didn't quite pay proper attention to the copy on the website, which does note that it works on iOS. Thanks.