Implications of formatting for different file systems (default too wasteful)

I just bought a WD Elements SE SSD with 1 TB storage.
It came formatted with ExFAT. Seemed resonable at first, it’s a widely supported format between platforms and commonly found on external storage.
Although I noticed that Windows treats this as a regular drive, not an external one (e.g. in that it assigns it a “trashcan” instead of just deleting stuff) - hope that’s not already a lifetime reducer!

Now my problem with the default formatting is that it’s insanely wasteful for storing many little files.
While I do mainly want to use this particular drive to carry a big VirtualBox .vdi virtual machine disk file between computers to just run the VM off the SSD and have all my stuff everywhere without schlepping the whole Laptop, I’d also like to put some project folders with .git repositories in them on there, which uses lots of folders inside folders with many small files.
I noticed, in an example, one .git folder that used 20 Mega Bytes on an NTFS disk, copied to the WE Elements with ExFAT, the same folder used 1.5 Giga Bytes “on disk”, that’s orders of magnitude more & not acceptable.

But I don’t know the reasoning behind this default formatting, and whether using other file systems might change the life expectancy of the SSD.
Also, I have not kept up to date with how well e.g. NTFS is supported by Linux - it is likely that I’d need to access that drive from a Linux box, too, in the near future.

So what would be a good way to go about this…
Just reformat with exFAT with a much smaller cluster size?
Use NTFS? (Linux ??)
Is there something else out there (that also Windows machines support well) that I might have missed while dwelling under a rock?

Ok, so while, I checked, 1 MB (!) cluster size that the WD Elements came with already seems nuts to me, git has a problem on this filesystem specifically: It uses hardlinks, which exFAT does not support - what it then does to make the folder bigger IDK. But it seems that NTFS would be the only option then: → 2nd answer @ stackoverflow topic

You can just try out NTFS if you want. See here for NTFS on Linux NTFS - ArchWiki.

Most externals come with ExFAT because it “just works” on every computer a customer will have. That is likely why it is used on this product. I don’t see why you can’t try a more optimal solution for yourself though.