With a huge caveat that this is hearsay on top of opinion: I asked someone at a conference and their opinion was that basically Ling’s problem was the project runners eventually tried to ALSO rewrite the BEAM. There is a huge graveyard of attempts to rewrite the BEAM, and so adding an extremely difficult scope-creep to an already-difficult problem made failure and abandonment all but inevitable.
Also note that xen has generally lost favor to KVM.