No, it's your installed drive. The USB boot is fine, it sees your drive.
If you can, create an installer with this same bootpack and install over your current drive, don't format.
Your data and app will be retained.
Or partition the drive and install to the second partition. You'll have to find a way to create the full installer, not just the EFI partition to boot your old drive.
I have no other idea how to fix it.