Researchers at Eurecom have developed six new attacks collectively named 'BLUFFS' that can break the secrecy of Bluetooth sessions, allowing for device impersonation and man-in-the-middle (MitM) attacks.
It's also crazy how there is this push from all OEM to remove headphone jack and force consumers to use wireless earphones, further making the attack surface much wider.
A second USB port or headphone jack adds $1(US) to the manufacturing cost, if even that. Can't cut into the corporation's massive profits by even a little. Nope, can't have that.
Bluetooth has it's own stack. Wifi typically runs tcpip. Your post doesn't even make sense because both wifi and Bluetooth coexist today so clearly there was no "winner".
You aren't crazy. I remember this being posited as a wifi alternative too. They claimed you could have a Bluetooth signal that wouldn't reach beyond the walls of your home, preventing outside people (neighbors etc) from piggybacking on your network even if they had a password or the network was open because of the short range. And that tech does sort of exist today. A lot of mesh wifi routers use Bluetooth to connect to each other and provide that wifi to you in whatever part of your home you happen to be in. IOT devices do this as well. I believe this was called a piconet. But it never caught on, and I think it was more a theoretical idea than an actual real push.
Oh wow, I'm glad Bluetooth lost given that it's vastly inferior. I mean we're even starting to see wifi headphones now, soon Bluetooth will be relegated to legacy devices.