Seeing what hidden files exist does not necessarily answer the question - you'd need to know what those hidden files represent.
When System is that large, it's almost undoubtedly due to cache files. Caches are normally self-managing - they may be allowed to grow larger if you have sufficient disk space to support them, and they should reduce in size if you're running low on storage. Caches may also be temporarily large if you're in the process of adding your Photos library, Desktop and/or Documents folders to iCloud for the first time.
Caches sometimes fail to self-manage. Temporarily booting to Safe Mode will clear cache space - just one of a variety of things Safe Mode does. Right after you boot to Safe Mode you can restart normally. https://support.apple.com/HT201262
I'm pretty sure that caches for third-party cloud services like DropBox also still appear in System. By default, DropBox keeps a copy of your entire cloud archive on your HD - there's a setting that allows you to not store a full copy on your HD.