Business people demand it to protect intellectual property without realizing the ease of reversing it / wanting to say they're doing something to protect IP that their own superior will not realize doesn't help. It is making the best of an impossible situation, the paradox of sending your code to every single customer for them to run it while also wishing nobody could see it.
The more aggressive they make patent law the less useful it seems to become for protecting any actual investment, so here we are, clinging to wooden totems...
You can use wasm disassembler (like https://github.com/JoseFMP/wasm-disassembler) as a starting point to understand what’s happening. It would be much harder if it was obfuscated on top of that.
An incredibly cool example of this is the newest iteration of the HIVE malware which does exactly that. They build a custom VM via RCE in a buggy image format parser which allowed them to execute custom code on an iOS device.
This is already what (a lot of) Lua obfuscators do for game cheats, since Lua has a reference implementation that generates bytecode, that can be easily modified to generate the most awful, encrypted, obfuscated mess ever.
