iCloud & iCloud Photos · Storage Studio and iCloud
Can I stop Optimize Cloud Storage while it's working on a cloud folder?
Short answer: Yes. Cancel from the progress window at any time. Files already made online-only stay safely in iCloud and the rest stay downloaded, so nothing is lost — you can run it again later to finish.
Yes. The progress window has a cancel option, and stopping partway is safe. Files already made online-only stay in iCloud and download when you open them; files not reached yet simply stay downloaded.
Nothing is half-finished in a harmful way, because making a file online-only is never a delete — each file is either still local or safely in the cloud. You can run the pass again later to finish the job.
On a large iCloud Drive the pass can take a few minutes. Storage Studio paces its background work so your Mac stays responsive while it runs.