Watchman hangs on macOS Sequoia 15.7.1

Watchman consistently hangs on any call on macOS 15.7.1.
Logging shows it reaches sanity checking stage, but then hangs.

Log output:

watchman watch-del-all --foreground --logfile=/dev/stdout --log-level 2
2025-10-13T14:26:49,199: [] Setting permissions on state dir to 2700
2025-10-13T14:26:49,200: [] Setting permissions on state dir to 2700
2025-10-13T14:26:49,335: [] Setting permissions on state dir to 2700
2025-10-13T14:26:49,338: [listener] Watchman 2025.10.06.00 starting up on Mac-Mini.local by command /bin/zsh-l
2025-10-13T14:26:49,338: [listener] file limit is 1048575 kern.maxfilesperproc=61440
2025-10-13T14:26:49,338: [sanitychecks] starting sanityCheckThread
2025-10-13T14:27:49,533: [sanitychecks] running sanity checks
2025-10-13T14:27:49,533: [unix-listener] accepted client:stm=0x122204080
2025-10-13T14:27:49,533: [client=1:stm=4867506304:pid=3829] dispatch_command: get-pid
2025-10-13T14:27:49,533: [client=1:stm=4867506304:pid=3829] dispatch_command: get-pid (completed)
2025-10-13T14:27:49,534: [client=1:stm=4867506304:pid=3829] dispatch_command: watch-list
2025-10-13T14:27:49,534: [client=1:stm=4867506304:pid=3829] dispatch_command: watch-list (completed)
2025-10-13T14:27:49,534: [NOT_CONN:client=1:stm=4867506304:pid=3829] client_delete 1
2025-10-13T14:28:49,742: [sanitychecks] running sanity checks
2025-10-13T14:28:49,742: [unix-listener] accepted client:stm=0x122104080
2025-10-13T14:28:49,742: [client=2:stm=4866457728:pid=3829] dispatch_command: get-pid
2025-10-13T14:28:49,742: [client=2:stm=4866457728:pid=3829] dispatch_command: get-pid (completed)
2025-10-13T14:28:49,742: [client=2:stm=4866457728:pid=3829] dispatch_command: watch-list
2025-10-13T14:28:49,742: [client=2:stm=4866457728:pid=3829] dispatch_command: watch-list (completed)
2025-10-13T14:28:49,743: [NOT_CONN:client=2:stm=4866457728:pid=3829] client_delete 2
2025-10-13T14:29:49,940: [sanitychecks] running sanity checks
2025-10-13T14:29:49,941: [unix-listener] accepted client:stm=0x122104080
2025-10-13T14:29:49,941: [client=3:stm=4866457728:pid=3829] dispatch_command: get-pid
2025-10-13T14:29:49,941: [client=3:stm=4866457728:pid=3829] dispatch_command: get-pid (completed)
2025-10-13T14:29:49,941: [client=3:stm=4866457728:pid=3829] dispatch_command: watch-list
2025-10-13T14:29:49,941: [client=3:stm=4866457728:pid=3829] dispatch_command: watch-list (completed)
2025-10-13T14:29:49,941: [NOT_CONN:client=3:stm=4866457728:pid=3829] client_delete 3

This keeps looping forever.
Tried settings permissions on state folder, deleting it, reinstalling watchman. Ran first aid on system volume, everything was ok.
Nothing solved it.

System:
Mac Mini M2
macOS 15.7.1