telnet is fringe because it's totally plaintext and has obviously been replaced by ssh2 everywhere.
whereas irc daemons can easily be linked together by TLS1.2 and irc clients can also talk to servers over TLS.
Don't conflate protocols that are terrible with protocols that aren't 'hip'. ftp and telnet have been replaced (thankfully) and should die in a fire. Usenet is still cool though.
1 Spam and noise -> No proper authentication and moderating system for channels. It's hard to keep bad agents out of channels.
2 Competition -> Forums had more features (including a solution for point 1, also https) and didn't require a special client. If you could easily send cat gifs in chats IRC would have been great.
Or you can set channel so only voiced nicks can speak and de-voice a nick to moderate.
Or even make an access list so only specific authed nicks can join. None of this is ideal though I agree.