diverging implicit expansion problem with nested

Here is a simplified version of a problem I am having. The following code:

implicit class fooOps[F[_], A](foo: F[Either[String, Option[A]]]) {
  import cats.instances.option._
  import cats.instances.either._
  import cats.syntax.nested._
  def bar(implicit functor: Functor[F]): F[Either[String, Option[String]]] =
    foo.nested.nested
      .map(_.toString)
      .value
      .value
}

gives me:

Error:(33, 18) diverging implicit expansion for type cats.Functor[F]
starting with value functor
foo.nested.nested

moving the refrence to Functor[F] to the class level, ie:

implicit class fooOps[F[_]: Functor, A](foo: F[Either[String, Option[A]]]) {
  def bar: F[Either[String, Option[String]]] = ???
}

gives me the same problem. Why is this? Is there any way around it?

No repository file or test entry point is named. Start by reproducing the nested implicit-expansion example with the shown cats imports and inspect the compiler's resolution of Functor[F]. Done means identifying why resolution diverges and documenting a confirmed explanation or workaround.