The problem there is that the current M1-based Macs seem to be limited to 2 total displays. Instead, a daisy chain involves each display being treated completely independently, as if each one was connected directly to its own output. Picture trying to full screen an application on one physical display or a dialog box meant to appear in the middle of the display. A daisy chain does not result in a single 'spanned' display, which would create all sorts of inconveniences for applications that didn't realize there were two independent displays involved.Ironically on Macs that run Boot Camp (which I realize isn't possible on the M1 systems, at least today), when those Macs are running Windows, DisplayPort daisy chaining works just fine, so it's not a hardware limitation.

But even that limits you to 2 displays, whereas PCs can run 3+ displays from that type of setup as long as the setup falls within available bandwidth. Thunderbolt 3 can carry 2 full GPU interfaces, so in a Thunderbolt daisy chain scenario, each display still gets allocated its own GPU interface. The only displays that can be daisy chained on Macs are Thunderbolt displays, since Thunderbolt daisy chaining is a distinct entity. DisplayPort MST allows a single DisplayPort interface to be carved up to run separate displays, but macOS doesn't allow that.

This has been the subject of complaints for years on this forum, Apple's forum, and elsewhere on the Internet. macOS does not support DisplayPort MST, which is required for DisplayPort daisy chaining.This would be possible if you were using a PC, but not from the current M1 systems, or any Mac system as of this writing.

Multi display for mac book pro