Where XCF came from
XCF is GIMP's native working format, named after the Experimental Computing Facility at Berkeley where GIMP was written. Like PSD it preserves layers, channels, paths and selections so edits stay live. Also like PSD, virtually nothing outside its own editor reads it.
The technical picture
Compression: Lossless, layer-based. Transparency: Full alpha plus layer masks. Animation: Layer-based frames. Colour: 8-bit and 32-bit per channel. Typical file size relative to WebP: much larger than WebP — layers stored separately.
Where it opens
GIMP; partial support in a few other tools. This is usually the deciding factor when choosing between XCF and WebP — WebP renders in every browser but is uneven in desktop software, while XCF has a very different support profile.
Converting XCF to WebP
Flattening an XCF to WebP produces the publishable output — small, web-ready and openable by anything, which XCF very much is not. Layers and masks are flattened. Keep the XCF as the editable master.
Converting WebP to XCF
Rarely needed — GIMP opens WebP directly.. Expect the XCF output to be much larger than WebP — layers stored separately — that difference is the price of getting a format the destination will actually accept.