It is not removing XUL 'power' extensions and replacing them with 'neutered' WebExtensions mechanism.
It is not choosing to closely align with Chrome in terms of UI/UX and functionality.
It is not the letting go of Brendan Eich and the newer (much criticised) management.
It is not because of Mozilla foundation highlighting a few 'social justice' issues here and there.
The decline of Firefox is because of one thing only - the enormous marketing and engineering clout of Google and their utterly ruthless, relentless, anti-competitive pushing of Chrome across Android and all their web properties and even through ads all over the world.
More specifically, it is their bundling of Chrome as the default, preset browser on the world most popular mobile operating system that really swung the tide decisively in their favour. Once ordinary users got used to Chrome on Android, they would naturally seek out the same browser on their laptops and desktops, to minimise interoperability issues and maximise familiarity.
And while pre-installing Chrome on Android (and by the way, it is pre-installed even on most laptop/desktop purchases by "helpful" OEMs - such is its viral reach) may not be strictly illegal as per anti-monopoly laws (because alternatives are 'freely' available on the default app store), the fact remains that if a program that comes with the OS is "good enough", the very vast majority of users will not bothering changing it, and thus Google managed to cripple all other browsers while still subtly side-stepping any potential lawsuits.
So the decline of Firefox is in my opinion a social/political phenomenon and nothing to do with its technical competence or extendibility vis-a-vis Chrome. It is certainly a more than competent drop-in replacement for Chrome (unlike say w3m or NetSurf), but who will bother to do the replacement in the first place, as long as Chrome continues to be "good enough" (which is does excellently) and it doesn't outrageously hurt the user base by some extraordinarily shocking screw-up (and Facebook shows, even such odious abuse will be condoned by the user base by and large when the network effects are too big).