Restart loop - authenticator is required to verify startup disk

I have a 13" M1 MacBook Pro (2020). Recently it has been restarting immediately after logging in and showing a popup stating "Authentication is required to verify startup disk". After entering my password, the Mac boots to the login screen, I login, the computer works fine for a minute or two, then immediately restarts again.

I took it to the Apple Store. They ran diagnostics but couldn't find any hardware issues. They helped me erase my SSD and reinstall MacOS - it worked fine for an hour or two of active use. But now the restarting loop is back as I described earlier. I've tried running first aid through disk utility but everything seems normal. Could it just be a hardware issue still? Has anyone ever encountered this issue?