I wonder if a little of both has happened in Europe. Wandering around YouTube the past few years, there's these pockets of musicians and their proponents and fans. Young people perform rock classics with enthusiasm and respect that roughly resembles the enthusiasm and respect that young people (like me) had for it when it came out. The difference is they don't think it's "their" music so much as it's great music of an earlier time they wish they could visit. Some of them are really talented.

There's a few that are writing their own stuff. They continue older styles, but also grow the style, like what happens in jazz.

I have to mention one band formed by pre-teen girls in Ukraine several years ago. They became refugees due to the Russian invasion, and now live in Germany. Perhaps their biggest influence is Green Day, but they draw from a wider range of the rock canon, from pop to emotional drama. The latter addresses impacts of their refugee situation. They are talented, and working with minimal resources. They're called the Sixsters.