Just read that Xbox are not supporting USB external drives and will instead only support memory extension cards:
Microsoft has
announced that
Seagate will be offering storage expansion cards for both the Xbox Series X and Xbox Series S. In other words they’re a 2020's take on the memory card; something that fell out of fashion during the early days of the
Xbox 360.
The cards plug into the back of the console, adding 1TB of extra storage to your Xbox. Microsoft promises that they take advantage of “the full speed and performance of the Xbox Velocity Architecture”, meaning they should be just as fast and reliable as the internal SSD.
The downside is that there won’t support external hard drives plugged into the USB port. If your games aren’t on the internal hard drive or one of Seagate’s expansion cards, you won’t be able to play them.