Passwordless with Identifier First

@ag_yaron thanks for your reply, I appreciate it.

I created a sample React app so you can test it: https://auth0-sample-rosy.vercel.app/

In my application, I have enabled two connections: Database (Username-Password-Authentication) and Passwordless (email).

The registration is disabled. Only users added by admin can log in to the app. I have added two users:

User 1 - he was added via Bulk Import without password and assigned to "email" connection: https://auth0.com/docs/users/bulk-user-imports. I would like the only way for him to log in to be Passwordless via code sent to his email.
User 2 - he was added in the administration panel in a standard way and the password was specified for him. You can try to log in as this user, the password is "Test007$".

In the app, I have enabled Identifier Frist Authentication Profile:

I was hoping that it is working in such way that if I put into a login form User 1 email, Auth0 recognize that for this user a primary and the only connection is Passwordless and in the next step I will have Paswordless email form:

Instead, a standard form with a password appears but this user does not have a password so he can't log in...

Am I doing something wrong or is it a bug? How to make it work?

Thanks in advance for your help!