Pairing Apple Watch error due to software update

I reset my Apple Watch Series 4 but now I can't pair it again (to my iPhone Xs, updated to current IOS 14.6). I tried pairing it automatically and manually but in both cases it interrupts the pairing to update the watches software. It offers me to either update or stop the pairing. I opt for the update and after a couple of seconds it says it could find any update and suggests trying it again when connected to wifi, note: I most surely was connected and tried multiple times on multiple different wifi. It then shows two choices, "try again" and "restart". No matter how many times I try again, the issue persists.