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While iTerm2 does not require monospaced fonts, they look much better than proportionately spaced fonts.

iTerm2 has the capability of rendering text with thin strokes to improve readability. You can change how this works in the Text panel of the Profiles tab of Preferences.

You can also specify the a "non-ASCII" font in the Text panel of profile preferences. This font will be used for all code points greater than or equal to 128 or for characters with combining marks.

Some fonts, such as FiraCode, support ligatures if enabled in iTerm2. You can enable ligatures in Prefs > Profiles > Text. Ligatures are rendered using CoreText, which is significantly slower than Core Graphics; ligatures are also not supported by the GPU renderer, which is also much faster than the legacy renderer.