Wipr 2 uses Apple's new 'URL Filters'

AdGuard goes over it more thoroughly than others. It’s not local but it has parts that are local, like it does a prefilter to decide if it needs to query the server first. It’s combining a lot of technologies like Privacy Pass, OHTTP, and private information retrieval to make it work server-side while still being private. With DNS blocking, your DNS server sees your requests and your IP address so they know what websites you’re visiting.