I don't think there's any way to resolve this issue that would make everybody happy. Making a "transgender" division wouldn't work; there are too few transgender people and they cover a vast range of physiology.
Allowing born male transgender people to compete in female divisions without restriction essentially marks the end of biological female competition at the elite level (and also down the line). Even worse is that mixed in with true trans people, you'll have people pressured or incentivized by their countries to pretend to identify as female merely to win championships, medals, etc.
Forcing people to compete in the biological sex of their birth certificate, by itself, doesn't eliminate issues. There's a case in Texas where a boy who was born a girl has been forced to compete in the girls' wrestling division, even though he's taking male hormones as part of his transition (he dominates there, of course). That doesn't get into the social humiliation of the policy which essentially tells you that your identity is worthless, or the exclusionary policy of simply banning them from all competition.
My own imperfect solution is as follows: since gender has grown more complex in ways that can no longer neatly accommodate male and female divisions, I propose replacing them with "unrestricted" and "restricted" divisions.
The unrestricted division will be for biologically born boys, trans girls with male pattern development/testosterone levels, and transitioned trans boys with male-like hormones (while still limiting the amount of testosterone, etc. allowable to normal male levels for all groups).
The restricted division will be for biologically born girls, trans boys with female hormone levels (not yet begun hormonal transition) and certain subsets of trans girls with very clearly defined criteria: e.g., trans girls with well documented continual suppression of male hormones since before puberty - that suppression would need to continue while they compete in the restricted division, of course. Also the small subset of trans girls with androgen insensitivity syndrome or similar conditions.
(edited to add an obvious group to the restricted division that I forgot about)