Why can't I set Passcode on my Apple Watch Ultra 2?

Hi.

i just bought apple watch Ultra 2 yesterday and after I paired it with my iPhone it asked to set a passcode so that nobody can misuse my watch. But as I try to set the passcode for wallet it shows that all the passcode settings except wrist detection are greyed out and are unable to change.

I can’t turn on the passcode. My screen time is off, tried turning off content restriction completely or by turning off passcode and account changes. But nothing worked.

Could anybody help how can i turn on the passcode and what should I do?

[Re-Titled by Moderator]