Does iCloud compress and deduplicate (block level) stored files?

I have a lot of data (mostly documents, scanned images, etc.) that I want to store in iCloud by copying it to my Mac, and then (after it uploaded to iCloud) removing the local download to save storage space on my Mac. This way the same files will also be available from my iMac, MacBook, and iOS devices.

I currently have around 20TB of storage on various storage devices (NAS, local Servers, External drives, etc.) but I only have 2TB of iCloud Storage.

So the question is, will iCloud compress and do block level deduplication on the files stored in iCloud? Or will it store the duplicates as unique files? For example, say I store a 1GB PDF file in Documents/test/file.pdf, and I store an exact copy of the file under Documents/whatever/file.pdf - will iCloud only store the file once, and create 2 links to the file?

I have a lot of duplicate files from years of storing it on different devices (e.g. storing on an external drive, then storing the same data on a flash drive, and on my hard drive, and so on) that I need to organise. I will (at some point) sort these files out and organise them - and then only have a single copy. However, it will be very time consuming as it is hundreds of thousands of files stored in different folder structures.

I need to decide whether I just upload everything to iCloud and organise it later, or whether I need to organise it before uploading it to iCloud. if iCloud does compression and block level deduplication (in the same way that APFS, ZFS, or BTRFS does) the answer is simple - upload everything and organise it step-by-step. If not, the answer is simple - organise it first, then upload as the files are organised.