100% agree. Bookmarks are cumbersome to make, hard to search, and just generally kind of annoying to work with. They kind of integrate into searching on the URL bar, but not very well. Many of them have tagging support, but the system feels like an afterthought.
And I'll add onto that, the way browser history works is also kind of annoying. I don't really trust that I'll be able to re-find a page I visited at a particular point in time. Visiting the same page twice doesn't create multiple history entries, it's hard to search by date. It feels really unreliable to use as a log.
There's a lot of room for innovation here, we're only just now starting to see browsers merge in tab grouping and containers, which I could have sworn Opera already supported ~10-15 years ago. I don't feel like we've spent enough time actually thinking about what different types of workflows people have for browsing the web and about how bookmarks/history/tabs could be adjusted to make those workflows easier.
It would take too long to list out all of the experiments that would be worth running (bookmarking screenshots or assets on a page, having bookmark "containers" for search, automatically categorizing bookmarks based on the domain or keywords inside the page, offline bookmarks that store the current state/DOM of the page, not just the URL, etc, etc). I think Edge was playing around with marking up pages using a stylus, but I don't know if that's still a thing now that they're based off of Chrome. And web annotations have been standardized for ages now. Still not integrated into any browser UIs that I'm aware of.
In my opinion bookmarks are one of the most underdeveloped parts of the modern browser, closely followed by history, and then by tabs themselves.