The most basic difference between citizens and non-citizens is that the former have an unconditional right to be in their country of citizenship while the latter do not. Widespread rejection of identity-based discrimination and acceptance of universal human rights may have contributed to more people thinking that having citizenship in the place you call home is no longer important. But they are wrong, at least when it comes to Japan.
Many people may associate citizenship primarily with voting and other political rights, as well as eligibility for certain government jobs. Arguably these are only secondary benefits of citizenship. Children cannot vote or work, and adult citizens can be ineligible for these benefits due to criminal convictions or other impediments. Go back not too far in history and gender and wealth were preconditions to political participation, and merely being poor or female were absolute impediments, citizenship notwithstanding.
No, the most fundamental aspect of citizenship lies in geography; the physical metes and bounds of the place (or places) on Earth where you have it. As COVID-19 has shown, decades of globalization may have resulted in expats ignoring at their peril this very ancient distinction between citizen or not.