Magic keyboard CAPS lock freezes system

Related to this thread by the looks of it: https://discussions.apple.com/thread/7677927

When I hit the CAPS lock on my magic keyboard, all system input halts for 3-4 seconds. To note, it is only the turning ON of CAPS that does it. Once CAPS is on and the freeze ends 3-4 seconds later, I can hit CAPS off and input is fine.

CAPS on my MBP works perfectly fine, it's just the bluetooth keyboard. Battery is recently charged.

I chose 'Bluetooth' as the Topic for this comment, there was no available Topic for peripheries like my keyboard, only trackpad and magic mouse.