Starting March 13, 2023, all newly created spaces in Google Chat will be in-line threaded. Users will no longer have the option to organize them by conversation topic, where related messages and replies were grouped together in the main conversation window. Existing spaces organized by conversation topic will continue to function as they do currently.
Later this year, existing spaces organized by conversation topic will be migrated to the new in-line threaded experience. Google has not released a date for that yet.
Current chat spaces organized by topic:

Chat spaces organized with in-line threading: