How many folks out there need to run arbitrary untrusted code on their systems? I think most of the time, the code they run is either their own or from a trusted third party.

And for those use cases, where secure containment of running applications is not a goal at all (beyond maybe taking some basic precautions), I fail to see any value to recompile it to WASM, CLR, JVM, Z80 bytecode or whatever else.

Those who need isolation - yeah, WASM could be a very solid alternative to having a VM. But it's a pretty niche use case.