Wine 8.0 is out now, a big improvement over the last stable release with many upgrades for Windows to Linux compatibility across thousands of games and apps. This is part of what makes up Steam Play Proton, the compatibility used on Steam Deck to run Windows games.
One of the major changes here is the conversion to the PE format for various modules. This format is used by Windows, and an important milestone for Wine to increase compatibility with copy protection, 32-bit applications on 64-bit hosts, Windows debuggers and more. Work is still to be done though to finish it properly, as some modules still need to be properly converted.
The Wine developers say they also implemented a "special syscall dispatcher", to avoid the overhead of a full NT system call to minimise the performance impact.
WoW64 was upgraded too, and once the final PE work is done, they say it will then be "fully possible" to run 32-bit Windows applications without needing 32-bit libraries. This is no doubt something many are looking forward to.
Lots of Media Foundation fixes and improvements too that should help audio and video issues across many apps and games, Direct2D upgrades, lots of optimizations for Direct3D and newly supported Direct3D 10 and 11 features are in, better steering wheel support, big improvements to controller hotplugging, better force feedback support, better support of DualShock and DualSense controllers, better support for CJK fonts and so on.
Absolutely lots more you can see in the release notes.
Hopefully later this year Proton will see a full upgrade to the latest Wine release, to give us even more improvements for gaming on Steam Deck and Linux desktop.