As a previous Squarespace user and designer, using the platform from 2005 and leaving it with the Squarespace 6 launch in 2012 (due to a loss of functionality and flexibility that was in Squarespace 5 that a lot of Squarespace users today are completely oblivious to), this is a huge leap forward for WordPress in my opinion. In fact, with further proper refinement, I believe WordPress is on the home stretch now to surpassing the ease of use and flexibility of Squarespace which is amazing for an open platform.

That said though, I'm sure it probably feels like a stumbling, confusing leap for a lot of developers (of which stepping into a new realm of possibilities and potential always is) but from my perspective, it looks remarkably like development for Squarespace 5 used to be. So as Justin noted, if you're developing a theme for a singular client specifically, you can completely enter CSS code into your theme as you've always done.

Yet if you're designing a theme for sale to many users, you'll want to use the theme.json so all of the styles applied to the blocks can be fully modified by the end user if desired. That's because the design flexibility will be the paramount selling point for these. So the end user is using the theme as a starting point for their own design, rather than just as an end point.

This is why Squarespace 5 was extremely popular with not just developers but designers even more so because they didn't need to know HTML coding but only the basic understandings of how CSS worked to design a site within it. This was possible because it had a fully integrated CSS Style Editor within it (kind of like the WordPress 5.9 Styles area but on steroids) that was much more powerful than the one in Squarespace 7 today because you could modify the styles of a theme and export it as an XML file that someone else could import (like a WP child theme but just for style modifications).

So what this creates is a larger tiered ecosystem whereby developers will have designers as their primary customers (because they don't have the coding / scripting skills) and designers will have end users as their customers (because they don't have the comparable professional design skills).