Modal image uploads not working (v2023)

v2023

For some reason my modal image uploads are not working.
The dialog shows “File not found” after selection, although it showed the progress bar.
Where the filename usually is there is a code.
I inspected the uploads folder and the temp folder was created fine, but its empty.

Non-modal uplads are working.

I have updated template and also ran composer update during generation.

I’m using file path encryption

Any ideas?

a litlle extra info, F12 network shows the file type isn’t being understood:
application/x-www-form-urlencoded;charset=UTF-8

rather than jpg