YouTube App Adds HDR Support for iPhone 12
The most recent YouTube App update (15.45.2) has added HDR support for the iPhone 12 mini, iPhone 12, iPhone 12 Pro and iPhone 12 Pro Max. YouTube has supported HDR on its iOS app since the iPhone X but has required updates to support new hardware.
To check to see if you are watching YouTube videos at their highest quality, you can simply press the three dots on the top right of the video, and you should see "HDR" options listed on supported videos.
HDR options are also only available on devices released since 2017 that have OLED displays (so that excludes all iPad models and the iPhone 11 and iPhone XR).
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