azure-functions-host: Microsoft.AspNetCore.DataProtection - IOC error

After updating my function to v3 I get this error on startup:

[08/01/2020 15:11:34] Loading startup extension 'Startup'
[08/01/2020 15:11:34] Loaded extension 'Startup' (1.0.0.0)
[08/01/2020 15:11:34] A host error has occurred during startup operation 'fba5bef3-a5ce-4006-a20a-160977aca2d8'.
[08/01/2020 15:11:34] func: Invalid host services. Microsoft.Azure.WebJobs.Script.WebHost: The following service registrations did not match the expected services:
[08/01/2020 15:11:34]   [Invalid] ServiceType: Microsoft.Extensions.Hosting.IHostedService, Lifetime: Singleton, ImplementationType: Microsoft.AspNetCore.DataProtection.Internal.DataProtectionHostedService.
Value cannot be null. (Parameter 'provider')

This is my current setup:

• Microsoft Visual Studio Professional 2019 Version 16.4.2
• azure-functions-core-tools@3.0.2009

And this is my .csproj

<Project Sdk="Microsoft.NET.Sdk">
  <PropertyGroup>
    <TargetFramework>netcoreapp3.1</TargetFramework>
    <AzureFunctionsVersion>v3</AzureFunctionsVersion>
  </PropertyGroup>
  <ItemGroup>
    <PackageReference Include="Microsoft.Azure.Functions.Extensions" Version="1.0.0" />
    <PackageReference Include="Microsoft.NET.Sdk.Functions" Version="3.0.1" />
    <PackageReference Include="Microsoft.AspNetCore.DataProtection.AzureKeyVault" Version="3.1.0" />
    <PackageReference Include="Microsoft.AspNetCore.DataProtection.AzureStorage" Version="3.1.0" />
    <PackageReference Include="Microsoft.AspNetCore.DataProtection.Abstractions" Version="3.1.0" />
  </ItemGroup>
  <ItemGroup>
    <None Update="host.json">
      <CopyToOutputDirectory>PreserveNewest</CopyToOutputDirectory>
    </None>
    <None Update="local.settings.json">
      <CopyToOutputDirectory>PreserveNewest</CopyToOutputDirectory>
      <CopyToPublishDirectory>Never</CopyToPublishDirectory>
    </None>
  </ItemGroup>
</Project>

Startup.cs file:

using System;
using FunctionApp1;
using Microsoft.AspNetCore.DataProtection;
using Microsoft.Azure.Functions.Extensions.DependencyInjection;
using Microsoft.Azure.Storage.Auth;
using Microsoft.Azure.Storage.Blob;
using Microsoft.Extensions.DependencyInjection;


[assembly: FunctionsStartup(typeof(Startup))]

namespace FunctionApp1
{
    internal class Startup : FunctionsStartup
    {
        public override void Configure(IFunctionsHostBuilder builder)
        {
            var storageUri = new Uri("https://potato");

            var blobClient = new CloudBlobClient(storageUri, new StorageCredentials("accountname", "pass"));
            var container = blobClient.GetContainerReference("test");

            builder.Services.AddDataProtection()
                .PersistKeysToAzureBlobStorage(container, "test")
                .ProtectKeysWithAzureKeyVault("test", "test", "test");
        }
    }
}

It was definitely working in 2.2 Downgrading Microsoft.AspNetCore.DataProtection packages do not help. Running from VS or in the command line returns the same error.

The only solution is to do not upgrade to the v3 function app 😦