It's not only "it doesn't fall off".Meanwhile, Alakazam is considered amazing in-game because unlike most other early game nukes, it never fully falls off, and continues to sweep through huge swaths of the game, even after everything else catches up to it in evolution.
Unlike other mons that also rely on the punches to succeed, Alakazam gets one of the most valuable offensive types in Johto, Psychic, and it gets moves to work with in a timely manner, unlike say, Espeon.
It gets Confusion as soon as it evolves on Lv. 16, which is by itself as strong as the punches due to STAB, but it gets an upgrade to Psybeam on Lv. 21, which already relegates the punches to coverage instead of a must. Not to mention the STAB is very much appreciated against Morty and Chuck, the two next leaders after Miltank (following the level caps). It also gets STAB Psychic on Lv. 38, ensuring it remains at the top of the food chain with one of the strongest neutral attacks in the game.
Abra starts off strong, it keeps getting better throughout the game, and has several favorable matchups due to its combination of raw power and coverage options.
There really aren't any mons close to it in GSC.
Oh, and btw, since it's a trade evo, you get to skip Kadabra and go straight to Alakazam at Lv. 16, before Whitney.