XML grew from SGML (like HTML did), and it brought from it a bunch of things that are useless outside a markup language. Attributes were a bad idea. Entities were a so-so idea, which became unapologetically terrible when URLs and file references were allowed. CDATA was an interesting idea but an error-prone one, and likely it just did not belong.

OTOH namespaces, XSD, XSLT were great, modulo the noisy tags. XSLT was the first purely functional language that enjoyed mass adoption in the industry. (It was also homoiconic, like Lisp, amenable to metaprogramming.) Namespaces were a lifesaver when multiple XML documents from different sources had to be combined. XPath was also quite nice for querying.

XML is noisy because of the closing tags, but it also guarantees a level of integrity, and LZ-type compressors, even gzip, are excellent at compacting repeated strings.

Importantly, XML is a relatively human-friendly format. It has comments, requires no quoting, no commas between list items, etc.

Complexity killed XML. JSON was stupid simple, and thus contained far fewer footguns, which was a very welcome change. It was devised as a serialization format, a bit human-hostile, but mapped ideally to bag-of-named-values structures found in basically any modern language.

Now we see XML tools adopted to JSON: JSONSchema, JSONPath, etc. JSON5 (as used in e.g. VSCode) allows for comments, trailing commas and other creature comforts. With tools like that, and dovetailing tools like Pydantic, XML lost any practical edge over JSON it might ever have.

What's missing is a widespread replacement for XSLT. Could be a fun project.