XMPP is much more popular for private messaging, so you don't have many large public group chats like on Discord (and lesser extend Matrix). It can do it, but clients are not really optimized for that to be honest.

You can btw learn more on https://joinjabber.org

As for the specific questions on e2ee: OMEMO as it is currently implemented in most clients is very similar to Signal in security, but like Signal it does not encrypt metadata. There is an updated OMEMO standard that does encrypt metadata as well, but it hasn't been adopted by any popular XMPP clients yet. However both versions are significantly more secure than Matrix's MegOLM, which has chosen to sacrifice a lot of security for user convenience IMHO.

XMPP is actively developed, but it doesn't have much funding for the open-source efforts, so it lacks PR and some things don't develop as quickly as what you might be used from VC funded for-profit companies like Element/matrix.

I like the Movim webclient, but most current users seem to prefer the native clients for XMPP.

XMPP uses way less resources because it was designed to scale to billions of users for chat, instead of being some over-engineered failed experiment to use a DACS for chat, which really isn't a good idea and never was.

I am hosting a two-person XMPP server now, and it's pretty light on resources. Matrix, however, I am not even sure my VPS would even handle: I've seen multiple people talk about how their servers would explode when someone tries to join a large room. And also there's an issue of every participating server storing chat history/media: my disk is small, I need it for the media on my site!

I am also concerned about how overly prevalent the central matrix.org server is.

XMPP is too fragmented with all the addons or whatever they're called (edit: XEPs). Chatting with people on different servers, or even different clients is a crapshoot whether basic features like encryption are enabled. I have a lot of hope for Matrix as they work out the bugs.

I'm also still interested in the xmpp vs matrix debate. I'm using matrix ATM because it seems more actively developed and used, but I know some people still swear by xmpp. Ultimately I really just want a decentralized alternative to discord, but beyond that I feel like I'll just want to go to whichever alternative has the most users, since that's pretty useful for chatting software.

I've heard feedback that matrix doesn't seem to be very united, with different groups implementing different competing features proposals etc., which does seem to be a pretty big issue.

I'm also pretty optimistic about a lot of the new stuff being built on matrix. I recently became aware of Commune, which is about making sections of matrix servers web searchable, and that sounds incredible - one of my biggest issues with discord is how often it gets used as effectively game wikis, collecting all these guides and information that's only accessible through a proprietary discord account. No anonymous search.

XMPP is like email, a very open standard that was designed for interoperability even with more closed servers that included proprietary features and extensions. It can be configured to be secure and private. Matrix is another attempt at a more closed protocol / ecosystem with the difference that you can self host it. There have been also multiple complaints about the amounts of metadata that Matrix scatters across servers.

The only thing I dislike about XMPP is that stuff like push notifications and proper mobile clients aren't as easy to get as they are with Matrix. Privacy and protocol-wise I would pick it any day - even if the only advantage is that is is considerably simpler than Matrix.

https://hackea.org/notas/matrix.html

XMPP lacks half the features of Matri, userbase is non existent, and there's not a single good client. That's all you need to know.