Specifically they are referring to synced passkeys (passkeys generated by services like Google password manager/1Password/Apple and are linked to that account).

Because these passkeys are stored in the Cloud and synced to your providers account (i.e. Google/Apple/1Password etc), they can't support attestation. It leads to a scenario where Relying Parties (the apps consuming the passkey), cannot react to incidents in passkey providers.

For example: If tomorrow, 1Password was breached and all their cloud-stored passkeys were leaked, RP's have no way to identify and revoke the passkeys associated with that leak. Additionally, if a passkey provider turns out to be malicious, there is no way to block them.