Minecraft: "You need to authenticate to Microsoft services"

Hi!

I have recently purchased Minecraft on iPad but I am unable to play online due to problems connecting to Microsoft Account in game.
I am trying to setup so that me, my daughter and some of her friends can play together online.

Problem Description

I am unable to play on online servers or connect to any minecraft realms.
I am able to log into my Microsoft account in the game, or at least my GamerTag shows, but when trying to connect to a server I get the error message:

"You need to authenticate to Microsoft services".

Minecraft Realms are no able to load either with the error message:

"We could not connect to Realms right now. We will try again soon"

So I am able to play offline and on LAN but not online due to the errors above.

Microsoft account that I use runs without any restrictions (no children block of online play)

What I have tried

#1 I have confirmed that I can login to the Microsoft account with the Xbox app on the iPad so the credentials are valid.

#2 I have tried switching to a secondary Microsoft account but with the same erroneous result.

#3 I can login to the online servers from my Windows machine that runs on same home network and my network connection is otherwise stable.

#4 UPnP is enabled on router and I anyway opened xbox live port on router specifically (even though it should not be needed as I can login over the xbox live app), but same error.

•Port 88 (UDP)

•Port 3074 (UDP and TCP)

•Port 500 (UDP)

•Port 3544 (UDP)

•Port 4500 (UDP)

#5 Started hosting an online server with exact version as the IPadOS bedrock version, but same error.

System Info

Minecraft version: 1.14.30 (updated to latest)

iPad 10.2 7thGen

iPadOS 13.4

I would really appreciate some support in order to get this working.

I am happy to provide additional information on request.

Thanks in advance

Anders

:)