There was a breaking change after WinSCP 6.1.2 causing MissingMethodException as a method was missing, but .NET optimisation had this used implicitly. So BizTalk 2016 can only be used up to this version. Later BizTalk 2020 CU6 has been recompiled with latest WinSCP without this removed method. CU6 uses WinSCP 6.3.5 by default, but later can be used with AssemblyRedirect also. The easiest is to not install WinSCP, but only copy the automation.zip contents into BizTalk installation folder. It can be confusing to install and have one version in GAC installed and other from automation.zip, especially with consultants, outsourcing vendors, different people involved. Even if not installed and you need to troubleshoot from the server with GUI, you can still use WinSCP.exe manually from extracted automation.zip.

Version matching information with different CUs are listed here:
https://learn.microsoft.com/en-us/biztalk/core/sftp-adapter