Behind the scenes, it's using QEMU with Alex Graf's patches for hvf (Hypervisor.framework) support, so it's Virtualization, not emulation. In other words, the performance is really good ;-)
BTW, in case you don't want to depend on a fork, upstream podman is going to gain M1 support (in the sense of 'podman-machine' knowing how to start aarch64 VMs with hvf) very soon.
BTW, in case you don't want to depend on a fork, upstream podman is going to gain M1 support (in the sense of 'podman-machine' knowing how to start aarch64 VMs with hvf) very soon.