I don't know what's wrong with XMPP other than the network effect collapsed when the GMail chat thing was killed, while the mobile client options were poor for a very long time.
Matrix has the appearance of being a drop in replacement for Slack or Discord, but the design decisions seem so compromised that the only explanation is they did manage to establish a (somewhat weak) network effect? It certainly is not a good look for an open source project to be running on Slack or Discord (free/cheap plans rugpulled or to be soon.) Then that leaves IRC, which has a network effect collapsing at a much slower pace.
I never got far enough to try hosting a matrix server, but reading the linked post -- Matrix definitely is not GDPR compliant. The combination of whatever end form of ChatControl the EU gets along with possibly hundreds of other laws across the world and individual US states makes me think the days of a public facing non-profit or small startup running a project like this are over. (Or maybe the future of open source is funding lawyers while the development is all done for pennies by AI?)
The GDPR is being neutered anyway because the EU caved in to Trump.
Not being chatcontrol compliant? That's a feature not a bug. Nobody wants that anyway. Just another stupid US lobby (Thorn).
A big organisation won't be able to run matrix for everyone no but that's the cool thing about it. People can run their own for smaller groups of people.