if you hold for too long it will reboot again, this is to allow rebooting when some app gets stuck, so you definitely need to release the button when you get past the progress bar and it starts booting. if it reboots because of holding too long there is WATCHDOG boot reason message shown briefly in top left corner.
If you no longer see bank0 invalid and can't get into recovery menu because it reboots earlier then it unfortunately looks like hardware fault and is probably best to return it.
what you can do now
record a video of the boot loop when not holding the button
record a video when you are trying to get to recovery menu
use nrfconnect to flash some earlier firmware like 2.24 or 2.23 just in case
flash special build that is using only flash storage builtin to the cpu and does not use the additional 8MB SPI flash chip. if it works that would mean it is the spi flash that has some issue and would alow you to use the watch with limited storage before you decide to return it. see end of this topic https://forum.espruino.com/conversations/399406/
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if you hold for too long it will reboot again, this is to allow rebooting when some app gets stuck, so you definitely need to release the button when you get past the progress bar and it starts booting. if it reboots because of holding too long there is WATCHDOG boot reason message shown briefly in top left corner.
If you no longer see bank0 invalid and can't get into recovery menu because it reboots earlier then it unfortunately looks like hardware fault and is probably best to return it.
what you can do now