Out of the box it can play audio in the background, and now that extensions are available you can block ads as well. You don’t really need constantly updating 3rd party clients or questionable firewalls anymore if you just want usable youtube on a phone.
ReVanced? Adguard has been able to block ads both from the yotube app and youtube in a browser for years, too. Also, any chrome based browser can do it with extensions for, also bene a thing for years. I’ve used opera, kiwi, and bromite for that.
Adguard is in the category of questionable firewalls. I used it for a while and it was just too kludgey for me when there’s not many apps with ads that I use anymore. Android has free software for pretty much everything at this point.