Microsoft is testing ray tracing on the S and X consoles. There is a new preview build of the game available for the Xbox Insiders. A next-gen patch is coming soon, as the latest test build is marked as optimal for Xbox Series X / S.
I have been testing out the latest version of the game, and have been able to enable some ray tracing support. It is not a simple switch. There is no easy way to download and install additional resource packs in the Xbox version of the game. There is a way to circumvent it, though. You can host a session on a Windows PC with the packs enabled, and an Xbox player can join that session, as long as ray tracing is enabled.
You can turn on or off ray tracing support from the settings menu. The setting for upscaling support is only available on the PC side. Hopefully that will eventually include support for FSR 2.0 on the Xbox.
The addition of support for ray tracing in the latest preview build suggests that it could be on its way soon.
The blocky aesthetic of the game was upgraded as part of the ray tracing launch for the Windows 10 version of the game in December 2020. The additional detail in texture packs and water reflections are some of the places where the ray tracing can be seen.