Disable macOS Sonoma Text Insertion Point (Cursor) / Caps-lock Indicator

Thanks to stephancasas for the explanation and the solution.
Another way of implementing it, from Terminal:

sudo mkdir -p /Library/Preferences/FeatureFlags/Domain
sudo /usr/libexec/PlistBuddy -c "Add 'redesigned_text_cursor:Enabled' bool false" /Library/Preferences/FeatureFlags/Domain/UIKit.plist

Reboot for the change to take effect.