Mozilla has two major problems though. Firstly, it largely relies on what is eventually advertising revenue, in a time when users are increasingly using ad-blockers etc and privacy laws reduce the value of targeted ads. Secondly, it has little traction on mobile, where iOS basically just has Safari because of Apple's rules, and Android comes with Chrome very much set as the default (and few people change it).
I don't really buy that COVID has made much difference. I think that, ultimately, the two problems above are the issues, and I'm not sure what can be done about them.
Even if Firefox were replaced with a shiny-new brilliant FLOSS browser, we still need an organisation behind it that drives web standards in the right direction (and I think they do need to have a major browser to do that as effectively as Mozilla has), and it still needs the funding to do it, so would still face the same issues as Mozilla, even if it weren't Mozilla.
Someone should be taking Google and Apple to task over bindling their browser and not enabling proper choice on a fair basis, as the EU did to MS (and actually MS has stopped offering a fair choice of browser too, where you choose a default and it is installed, rather than have a default you have to change, that they keep changong back in updates).