The reason is to align the text to the icon (so when the chat window background becomes transparent, the text would be lined up with the icon).
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Can you elaborate what you mean by V1 (did you mean the current chat?) and how the UX did not improve?
Definitely a much improved feature, testing it out right now!
Apologies for the miscommunication, it was a reply on @ValiantWind about a custom chat resource (BetterChat):
The new chat system has a clean UI and a pretty good UX.
One thing I would recommend is to add auto-completions. By autocompleting with built-in commands and usernames, players won’t have difficulties with using these commands.
Nowadays, people seem to struggle often with “/team” and “/whisper”, so it would be helpful to recommend the best input before they send it.
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How can we make chat tags with this? And how could we mute people with this?
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Please check out the previous Studio Beta announcement: New Beta In-Experience Chat System for Channels, Filtering and More! (we actually linked this above a few times in the original post, please read it in detail if you can!) for more usage examples, including implementing chat tags.
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Also I highly recommend you check out the documentation links for more information, for example the documentation for TextChatService | Roblox Creator Documentation lists out some of the default commands that are created when TextChatService.CreateDefaultCommands is set to true, including mute/unmute commands.
Why can’t I do /e dance? I should be able to
I tried to /e dance and things seemed to be working 
Maybe try again and see if it works now.
If you have more information please file a bug report!
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If you meant in Find the Marker’s one, dev banned because of Catzo’s Laugh clip
I already enabled the new system to see if it’s good. I like it so far because admin still works and it matches the rest of the UI. It has a few minor bugs that have already been reported and personally I think the : should be the same color as the name but other than that it’s great! Thanks for releasing it!
Really cool update, I am trying to play around with it but cannot seem how to change the chat window to be at the bottom left corner?
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This update is really good. New UI is only part of it, new exposed APIs that I can mess around with really opens up more possibilities 
If I switched to the new chat system and want to switch back how do I do this?
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I’ve been waiting so long for this!
Looks so much cleaner and modern.
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The chat gui doesn’t disappear when i stop hovering on it unlike the old chat system
Are there a any legitimate reasons as to why coreguis below the topbar are always misaligned? Seeing as newer stuff are still following this trend I’d thought I’d ask. ocd not fun
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How do you fork the ChatWindow’s UI as well as the ChatInputBar’s UI?
It’s in CoreGui now.
You can enable it by going to Studio Settings.
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For TextChatCommands, is there support for commands with multiple arguments?