Minecraft Java Edition has always functioned pretty much the same way since Mojang's acquisition of the developer by Microsoft. Bedrock Edition was created to integrate with Microsoft's account system, but Java has been operating on its own Mojang account island until the present. Java Edition will soon require you to sign up for a Microsoft account to play. However, you'll get the free cape.
In the early 2021s In the beginning of 2021, you'll have to move your Java or Mojang account to the Microsoft account system. https://minecraft-servers.biz/ claims this is to introduce two-factor authentication to provide increased security, though it'll also bring better parental control including chat and invitation block and account integration between Minecraft and Minecraft Dungeons.
As for Minecraft mods and PvP Mojang affirms that nothing will change. Java and Bedrock will remain entirely separate games. You'll be able to keep using your existing Java username, however if you're creating a Microsoft account for the first time, you could have to change the usernames of your accounts. If you already have an existing Microsoft account in the first place, you'll be able to join your Minecraft sign in right away.
To ease the pain of the transition, Mojang is giving away the Java Edition's most exclusive item: the cape. You'll receive a free cape for participating in the migrationprocess, and, while it's not going to feature the exclusive patterns of the Minecon mantles, it will finally give everyone the chance to feel regal for a while.
Although there is no reason to expect anything to change, players have concerns. Among them, the more restrictive terms of service of Microsoft could lead to bans and could result in some players being banned from accessing Minecraft.
More details are available in the FAQ as well as the official announcement. We'll see how it shakes out in early 2021.