This issue was addressed with improved checks. This issue is fixed in macOS Big Sur 11.2, Security Update 2021-001 Catalina, Security Update 2021-001 Mojave, watchOS 7.3, tvOS 14.4, iOS 14.4 and iPadOS 14.4. Processing a maliciously crafted image may lead to arbitrary code execution.
Apple Security Advisory 2021-02-01-4 - watchOS 7.3 addresses bypass, code execution, denial of service, out of bounds read, out of bounds write, and use-after-free vulnerabilities.