An iOS device running iOS 10 and later can send cool bubble and screen effects. You use these effects get your message across to other fellow iMessage users. With bubble effects, you can slam down your message or hide it in invisible ink. With screen effects, you can send balloons or fireworks.
Markup tools was a feature added in iOS 10 that allowed users to use basic editing tools for images. They started out being very limited but have now expanded to many other places around your iOS device. The places it can get use the most are in photos when taking screenshots and saving PDFs in Safari.