A quick look at the pinouts of an Intel 8086 & 8088 processor reveals a 20 bit address bus. There was high demand for the ability to address 1 meg (2^20) of address space, and Intel delivered.

See bus. The size of the address register determines how much memory the CPU can directly address. For example, a 20-bit address register can access up to one megabyte (1MB); 24 bits reaches 16MB ...

The number of lines (wires) in the address bus ... line carries one bit of the address. In 1981, the IBM PC had a limit of one megabyte of RAM because its address bus had 20 lines, and 20 bits ...