Shared albums could be hidden from your Albums list, because albums appeared in two places: in Albums and in Sharing. That made it difficult to find the albums shared with you in the Sharing tab. On request of many, Google now made under Albums 3 lists: All, Your albums, and Albums shared with you. By doing this, the option to hide albums disappeared.Â
On https://support.google.com/photos/thread/331996330/please-make-album-hideable-again you can read a reason why users wanted to hide albums.
When you select a number of photos, click on the Share icon, then "Create link", an kind of album is created, but it has no meaningful title (date or date range). These albums are hidden in Updates (Bell icon) > 3-dots > Sharing activity > Shared links.
When you open such link, you see that it has all options of an album, except a title. When you click on 3-dots > Edit album, you can add a title, but as soon as you do that, it becomes a normal album, is removed from the "Shared links" but added to your own albums list. Unfortunately, removing the title does not bring it back to "Shared links": it stays in Albums, with as title "n items".
You can use this work around for new sharing links, but the links will be hard to find back. For older albums, you can select all photos and create a new link, but you will have to inform the receiver that the old link will be obsolete.
You can share photos in a conversation. That will hide them in Updates > 3-dots > Conversations. The receiver must have a Google account.
You can ask the receiver to select all photos and add them to an album in Google Photos or otherwise save them, after which you can delete the album.