Problems with ssh keys

When I create a user key - it does not work. build starts to fail on access error (code 128).
Worked well previously (on other project).

I am unable to add an ssh key manually. not getting an error, but in the developers console I can see this print

it looks like private key is invalid key. Double check

but the key is valid.

Are you using an ed25519 key by chance?

Not sure what ed25519 key is.

I simply ran ssh-keygen as found in some guide I reached from your documentation (or bitbucket).

But why is the user key not working? (especially when it did just a couple of months ago. nothing changed).