I just want to clarify that Zelle was basically a 2017 rebranding of clearXchange, which existed since way back in 2011. Both Zelle and clearXchange were mostly marketing failures. The basic use-case of nearly-instant person-to-person transfers has been constant and functional throughout its existence.

And you're 100% correct that uptake in the long tail of smaller banks and credit unions is probably one of the biggest "issues" with the service. If your bank isn't signed up, there's nothing you can do as an individual except move to a bank that is. Systems like CashApp and Venmo don't have that issue.