Many people here are saying it mysteriously started working all of a sudden but I think they did an update or they installed new and happened to get latest version.
I had to remove and reinstall office 365 to get the correct version and enable the insider ring. Since I had manually installed onedrive afterwards trying to get this working, office 365 updates didn’t show an update available for onedrive. At the time I could not find a download for the new version of standalone onedrive. There seems to be three different ways to get onedrive -
Office 365, standalone installer, and Apple App Store and the update process is not the same for each. Maybe now the other methods have updates but that is how I did it for my office 365.