My MacBook Pro M1 trackpad stops working when connected to external display via USB

I used my MacBook on a projector, and since then, the trackpad has stopped working when connected to my external display with USB-C but works when connected via HDMI.

As a temporary solution, I found that the trackpad starts working again when I disconnect the USB.

I tried changing the cable with the same issue and also connected other devices to the USB with no problem.

I tried all ports with the same issue.

Bluetooth mouse working so computer is not frozen.

[Re-Titled by Moderator]