Accidentally overwritten my original .json backup. Firefox unable to import recovered bookmark from Bookmark Backup folder in Profiles.
I accidentally replaced my backup with the current bookmarks while trying to import from it. The original bookmarks were not present in Bookmark Backup in Profiles so I used Recuva for recovery. Now, Firefox gives the 'Unable to process backup file' thingy.
System Restore hasn't helped either.
Chosen solution
I managed to recover an undamaged bookmark using the Deep Search option in Recuva, in the Profiles folder.
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Such an error can be caused by a corrupted places.sqlite database file, so try to remove all places files in the Firefox Profile Folder and try to restore that JSON backup another time.
You can also try to create a new profile and test if you can restore the JSON backup there.
See:
Chosen Solution
I managed to recover an undamaged bookmark using the Deep Search option in Recuva, in the Profiles folder.