@E S,Thanks for posting in Q&A.
From your description, I know you want to change Windows 365 Boot to a Modern Passwordless Authentication.
Based on my research, Passwordless authentication is enabled automatically when the Cloud PC and local PC are using the following operating systems:
1.Windows 11 Enterprise with the 2022-10 Cumulative Updates for Windows 11 (KB5018418) or later installed.
2.Windows 10 Enterprise, versions 20H2 or later with the 2022-10 Cumulative Updates for Windows 10 (KB5018410) or later installed.
Hope this can help you.
If the answer is helpful, please click "Accept Answer" and kindly upvote it. If you have extra questions about this answer, please click "Comment".
Note: Please follow the steps in our documentation to enable e-mail notifications if you want to receive the related email notification for this thread.