There have been a few instances recently of fires in overhead lockers caused by powerbanks going into thermal overload (you can google them).
If this happens in the overhead the fire has more of a chance to become severe before someone notices it, so it is much more dangerous.
That's what is behind these changes.
China already had a ban on most powerbanks at all on internal flights unless they have the proper Chinese certification (which no Western ones do).
This is also why I would no longer consider buying cheap 'no mark' products that contain lithium ion batteries as it is these that tend to be the ones that go bang (powerbanks, vapes, electric scooters etc). Although there is a risk from many legit products as well (as was the case with the Samsung phones previously).
So the restrictions make some sort of sense although I can't see how they are going to enforce it (as they also can't do with requests to put devices into flight mode).