Iridescence and a corona have the same underlying cause. Water droplets individually diffract sunlight - mainly from their outer skins. The diffracted waves combine to send coloured light in particular directions.

The drops act in unison when they are more or less equally sized to form an orderly diffraction pattern in the sky - a multi-ringed corona.

The colour pattern is less orderly when the drops differ in size from point to point across the cloud - we see iridescence.