iCloud+ And Time Machine

Yes. iCloud is a synchronization service. Time Machine provides a backup. Ideally you'll use both. If you accidentally delete a file from your device it will also delete in iCloud. You can then use Time Machine to restore. Just remember, Time Machine only backs up files on your computer, so if you have selected "optimize files" in your iCloud Drive settings, files that have been offloaded to iCloud will not backup.

Forgot to say. The gold standard for backing up is the 3-2-1 rule.

3 copies of your data

Made 2 different ways

1 copy kept offsite

That may not be practical for day-to-day items, but for cherished photos, or other, it's worth the investment.