The previous policy, which blocked all Bitcoin trading apps and wallets, was widely (and expectantly) criticized by the Bitcoin community. While Apple certainly was trying to cover its legal bases in the murky Bitcoin environment, some theorized that Apple was also working to protect its long rumored digital payments system.
Whatever reason for the ban, it has been lifted now and Bitcoin trading and holding apps are now allowed on the iOS app store, so long as they conform to local laws. Coin Pocket, a Bitcoin wallet, was the first app to appear on the iOS app store last night. More are likely to follow in the coming weeks, but this is an encouraging sign that Apple's about face on cryptocurrencies seems legitimate.
HTML5 wallets were being designed in no small part because of Apple's ban. However, development on web-based wallets is likely to continue, with an eye to circumvent any potential future regulation by Apple or other entities (as well as provide wallets for users in countries where regulation makes getting a wallet difficult).
We will keep you up to date on the iOS wallet scene as it develops.