The solution to the Palestinian conflict needs a 'two-legged pincer', which entails the Abraham Accords and the two-state solution.
The Abraham Accords aim to isolate Palestinian extremists diplomatically, forcing them to accept a reasonable peace plan.
The two-state solution assumes that Palestinians will agree if Israel gives in on all key points.
The future Palestinian state can only be achieved after recognition of the Israeli state and renouncement of any form of violence or later claim to the agreement.
So far, there doesn't seem to be willingness from Palestinian leaders to accept these conditions.
Conclusion: Refusing to recognize a potential Israeli state in the long run only extends the conflict. The solution will likely end up being the consolidation of two peaceful states.