Early in the MCU's Multiverse Saga, Marvel Studios decided to retcon a major part of Elizabeth Olsen's Scarlet Witch backstory. Although fans weren't too happy with that decision at the time, in retrospect, it is one of the best decisions Marvel made throughout the saga. Scarlet Witch (aka Wanda Maximoff) has been a central character in the MCU since 2015's Phase 2-ending movie, Avengers: Age of Ultron. Wanda appeared in multiple Phase 3 projects, but her own story wasn't highlighted until the Multiverse Saga, particularly in Phase 4.
In WandaVision, the first-ever MCU Disney+ series, Marvel changed an important piece of Scarlet Witch's backstory, specifically by retconning the source of her powers. Originally, it was established that Wanda and her brother, Pietro, gained their powers from the Mind Stone while under HYDRA's control, but WandaVision later revealed that Wanda had had her powers from birth.
In the penultimate episode of WandaVision, fans were taken on a journey back through important moments in Wanda's life, and one of them featured her as a child in Sokovia.
The death of Wanda's parents has always been a major catalyst for Wanda's character arc and her journey as someone with superpowers, but a flashback scene in WandaVision confirmed that Scarlet Witch had her powers all along, as she used a probability hex to keep a Stark Industries bomb from detonating.
It was then explained that Scarlet Witch's powers remained within her but were amplified after she came into contact with the Mind Stone. So, Marvel Studios retconned that she gained her powers from the Mind Stone, explaining that she had them all along and that the Mind Stone just made them more prominent.
When WandaVision premiered in 2021, and fans learned that Marvel Studios had retconned Scarlet Witch's origin story, many did not like it. It wasn't that her new backstory was uninteresting, but rather that it is always upsetting when something in a franchise as big and connected as the MCU retcons a major plot point that was clearly established in an earlier project.
However, it has been five years since WandaVision came out. Now that fans have been given time to think about the decision to make Wanda have powers all along, and after everyone has seen what came after WandaVision in the timeline, it is clear that it was one of the best decisions Marvel Studios made in the Multiverse Saga.
For one, adding this layer to Wanda's backstory made her a more interesting character. The fact that she has had superpowers for essentially her entire life is more special than her receiving them from a magical object like an Infinity Stone.
Additionally, it added more to Scarlet Witch's character arc, as it proved that she was the one who kept herself and Pietro alive. Objectively, this is incredibly more interesting than the explanation that the second Stark Industries bomb was simply defective. It turned that section of her story from a coincidence into something that directly impacted her later in life.
It is also worth noting that, now that the MCU is implementing Mutants and the X-Men, making Scarlet Witch have natural powers all along makes the MCU version of the character more similar to her original comic book counterpart.
Initially, in Marvel Comics, Wanda is described as a Mutant, a member of the Brotherhood of Evil Mutants, and Magneto's biological child. In the MCU, she obviously won't be Magneto's child (unless Marvel pulls some insane retcon, which almost definitely will not happen), but it still makes her more closely resemble the original comic version of the character.
With that being the case, it also teases that Wanda could have a future in the MCU, especially since Marvel Studios is about to dive into the Mutant Saga following the December 2027 release of Avengers: Secret Wars.
At this point, Wanda has not been described as a Mutant, but it is possible that Marvel could call her a Mutant if she were to return after Secret Wars and establish that she was one of the first Mutants to be featured in the MCU.
It is important to remember that when Avengers: Age of Ultron debuted and Scarlet Witch was established as an MCU character, Disney and Marvel Studios didn't have the rights to the X-Men or the Mutants. Now that Disney is in possession of those rights, Marvel has free rein to use the Mutants any way it sees fit.
Will Scarlet Witch Return in the MCU?
Elizabeth Olsen's Scarlet Witch seemingly died in Doctor Strange in the Multiverse of Madness. However, her body was neither shown nor found, and, as fans have become accustomed to in the entertainment industry, if there is no body, there is no reason to believe a character is gone for good.
Wanda's children, Tommy and Billy Maximoff, are still alive and well in the MCU. Those characters are expected to be used in the next chapter of the MCU. If it were to be explained that Wanda is a Mutant, then that would effectively make Billy and Tommy Mutants as well, which would give Marvel the opportunity to use them on a major level in the next saga.
It is possible that Wanda Maximoff will return to the MCU in Doomsday or Secret Wars, but even if she doesn't, she could still be brought back after Secret Wars for the Mutant Saga.
Most of the Mutants and characters who will be in the X-Men movie will be entirely new to the MCU when that movie is released. Wanda could serve as the liaison between the franchise's earlier days and the new saga, especially if she were described as a Mutant.