Go to Photos app > Preferences > enable Optimize Mac Storage. That will add caching features that seamlessly remove older photos locally when running out of space. You won't notice a difference, basically.
Just in case if anyone is still looking for an answer on how to stop transfer of files to iCloud, here's a workaround - you can just delete the destination folder on iCloud and it will immediately stop the operation. Had to do that when I was trying to copy 67 GB. Not sure what to do if there's no destination folder (ie destination is root).