I’m stealing this from another comment:

The main advantage comes with phishing resistance. Standard MFA (time based codes) is not phishing resistant. Users can be social engineered into giving up a password and MFA token. Other MFA types, such as pop up notifications, are susceptible to MFA fatigue. Similar to YubiKeys, Passkeys implement a phishing resistant MFA by storing an encryption key, along with requiring a biometric. The benefit here is that these are far easier for the average user, and the user does not need to carry a physical device. Sure, fingerprints could possibly be grabbed with physical presence, but there is far less risk that a users fingerprint is stolen, than a user being social engineered over the phone into giving creds. For most organizations and users, this is far more secure.