As a dev for quite some time I can tell you that I don't want my source code dependent or located on some 3rd party computer that I have no control over.
All of Apple's cloud services to date consider the cloud version as the definitive master. This is bad for pictures, but devastating bad for source code because of the work effort put into creating source code.
That is not how XCode Cloud works. It is a cloud continuous integration / continuous build/deploy (CI/CD) service. It is
not a source code management (SCM) service. If actually had followed and read the the XCode clould links at the beginning of the article.
"
Secured and private
Xcode Cloud is designed to protect your projects and privacy, with all data encrypted at rest and access protected by two-factor authentication. Source code is only accessed for builds and the ephemeral build environments are destroyed when your build completes. ... "
Xcode Cloud is a continuous integration and delivery service built into Xcode and designed expressly for Apple developers.
developer.apple.com
"...
With Xcode Cloud, you can adopt a CI/CD practice that helps you develop and maintain your apps and frameworks. To automatically build and test your code when you make changes, Xcode Cloud needs access to the Git repository that contains your code.
When you configure your workspace or project to use Xcode Cloud, Xcode analyzes it to detect the Source Code Management (SCM) provider you use. On the “Grant Access to Your Source Code” sheet, click Grant Access and let Xcode guide you through your SCM provider’s native authorization flow.
...
.... required permission or role to grant Xcode Cloud access to your Git repository. Additionally, if you use a self-hosted SCM provider — for example, Bitbucket Server — make sure Xcode Cloud can access your Git repository. ...
.."
Allow Xcode Cloud to access your Git repository.
developer.apple.com
Requirements for using XCode Cloud. ( an excerpt . there are more )
" ...
Have an app record for your app in
App Store Connect or have the required role or permission to create one.
...
Your dependencies and additional third-party tools are available to Xcode Cloud
....
You use automatic code signing
.,...
Using Git for source control is a requirement to use Xcode Cloud.
.... "
Review account, project, and source control requirements before configuring your project or workspace to use Xcode Cloud.
developer.apple.com
Apple isn't keeping the master copy of anything except perhaps binaries and product submitted to the Apple App Store version the workflow if that is included. They are
not offering SCM master repository storage at all.
That is part of why it has been in beta for about a year because their service has to integrate with several other cloud services (including source control cloud service) in order to function correct. It is
not a singular 100% Apple 'silo' from top to bottom.
What happens if Apple decides that my code is somehow not up to their approval, will my code just get binned, or will I get banned like other Silicon Valley firms do?
It was never permanently stored there so what are you talking about ?
We have no SLA for Apple's cloud services and that means they are dangerous and unpredictable until Apple commits to some acceptable behavior in an SLA (Service Level Agreement).
having not read the manual , probably haven't read the contract language either.