132 column displays were common by the end of the 1970s.
80 column displays date back to the early 1970s.
I started coding on an 80 column display, and I have no doubt at all that a modern 16:9 monitor that can display a double page PDF or a web page with a variety of fonts is a much better display device.
It sounds like that was the limit they could fit in the available space given the technology (earlier versions had fewer columns, the "upgrade" to 80 was based on using new narrower holes) - the width was set by wanting to match existing infrastructure for money.
Isn't it more so it is readable inside a phone display to an ssh session as well as a fat 4K screen? That's my reason at least. Can always scale up something, but line breaks I didn't make myself make me want to commit unspeakable atrocities in the name of a demonic deity taking the earthly form of a little girl. Or, you know, angry.
Presumably, that's why they used 80 characters in the first place, as anything more is too hard to read.