Originally Posted by
Airlick
It's almost been 3 years and there's plenty of 4*s in Genshin that have not been replaced by 5*s or are situationally better than 5*s they were "supposed" to be replaced by. Xiangling is basically a 5*. Xingqiu can be more fitting in some teams than Yelan due to better energy management, the 2 share a niche, but they are the only 2 characters in it and you sometimes want both of them in a team or use both in separate teams. Fischl can be the best electro choice against many mobs if you just want to bring 1 electro character for it. Gorou, Mika, Faruzan, Sara - all have their own niche that has no 5*s equivalent, and it seems like a conscious design choice to make 4*s to fill these niches (though this can change in a few years when Mihoyo is out of ideas and needs more money).
Sure, there are also cases where 4*s are invalidated simply by a similar 5*s existence, but it's not the rule.