They are replacing it with their hilariously named “privacy sandbox” which basically bakes in support for Google ads and Google analytics, so Chrome (not individual websites) stores all the data about your browsing habits.

As far as I can tell, the privacy sandbox cannot be interacted with via plugins, so you get the options Google provides. Considering they just lost a lawsuit for tracking incognito users, I’m not hopeful they will respect any measure they say is privacy preserving.

The “privacy sandbox” is partially Google’s response to Safari and Firefox adding built-in (and automatically enabled) protection against third party cookies several years ago. And partially a way to serve up sites without a GDPR-mandated cookies notice (because the user tracking isn’t technically a cookie, so the law requiring consent doesn’t apply).
It preserves the functionality of third party cookies while giving Google a monopoly over the data they collect. It will also create the illusion that Chrome doesn’t allow websites to set cookies - so they can pretend to be more privacy focused while hiding that they are much less private.

It’s an excellent business move that leverages their near-monopoly browser market share to reinforce their near-monopoly online advertising and analytics products, while subverting consumer privacy laws!