This intrigued me because in the years that I used Final Cut I never heard of that happening. I couldn’t find you a nice single easy to understand and test answer, but here’s some suggestions.
1. The project is somehow looking for media or other materials that it needs in a path that no longer exists for whatever reason. It sounds unlikely this is your problem because you don’t describe anything changing before it just stopped working, but it’s the easiest one to test. The solution in the case of this problem is to make a new user account and open the project. https://joelyeaton.wordpress.com/2012/11/24/fcp-error-fixed-this-project-is-unreadable-or-may-be-too-new-for-this-version-of-final-cut/
2. The project has become corrupted during the last save. The original poster before you said they’d tried opening from autosave and it also did not work. You didn’t specify so it’s worth suggesting, try the autosave vault. Try several versions back until you find one that opens or are pretty sure it never will. Also, you hopefully have backups of the project and its vault on a different hard drive somewhere, try those.
3. Some errant piece of media referenced by the project has somehow become corrupted and when the project loads and connects to each individual piece of media, it fails once it reaches the dodgy one. Try the suggestions found here https://forums.creativecow.net/thread/8/1163934 which is to find a way to prevent the media in the project being accessed, thus making it offline and hopefully allowing the project to open and for you to reconnect the media in stages until you find the offending piece. Do this by disconnecting the drive if it’s on if external, or renaming the folder the media is kept in, so Final Cut ‘loses’ it.
Otherwise as far as wild guesses without much to back them up, most people describing the error seemed to run in to it around the days of Mavericks, so if you’re still on that version and if that somehow is the issue, updating would be a wise move anyway and it break a not opening project any further than it already is. Additionally, while making stab in the dark guesses, might be worth seeing if the file permissions on the project somehow got incorrectly set, makes no sense that they would but you can check easily so why not. Finally, when FCPx first came out it was definitely possible to run alongside FCP7, but several OS versions and FCPx versions later, maybe that changed? I haven’t kept up since I don’t use x, and left FCP7 a few years back. If practical, try getting rid of FCPx? Doesn’t really fit that it would suddenly be a problem now when it was fine before but I don’t know maybe FPCx auto updated or something?