Android has been experimenting with floating bubble notifications for some time now, but there have been no apps with which to use the feature despite the option being available within the developer menu. XDA had uncovered that Google was testing the new bubble functionality in its Messages app, and they have now managed to enable it. Implemented in the app, it works very similarly to Facebook Chat heads, and if eventually enabled by Google, will let you view entire conversations in addition to replying.
When we first noticed notification bubbles in Android 10 beta 2, they were buggy and frustrating to use. At the time, they were simply another way of viewing notifications, providing no additional functionality from the notification shade. However, as the feature evolved, it became clear that there was to be a higher degree of functionality — such as the ability to view entire conversations, as displayed here. Google has stated that it hopes developers will use this built-in bubbles API rather than any self-made solutions, as in the case of Facebook. This should bring a higher degree of cohesiveness to Android and will reduce development time for app developers who wish to implement such an interface.
As this is just an internal test by Google, we have no word on when the feature will be released in an official capacity. Google has been encouraging developers to implement the new API, so we'd speculate that the feature is being prepared for an official Android 11 release. XDA hasn't shared what method they used to test this functionality, but it probably requires modifying the APK, making it unlikely you'll be able to replicate this on your own. So, unless you're an advanced developer, don't expect to play with it anytime soon.