Use managed identity instead of AzureWebJobsStorage to connect a function app to a storage account

Referring to AnushaGarg comment, my function app is running fine with the System Managed Identity. Just follow these straightforward steps:

1. Set the system identity to "ON" for "myfunctionapp."
2. Go to the IAM settings of "MyStorageAccount" and assign the Storage Blob Data Contributor role to "myfunctionapp."
3. Rename the key from AzureWebjobStorage to AzureWebJobStorage__blobURI and set the value to "https://MyStorageAccount.blob.core.windows.net/." Microsoft Azure Functions Reference
4. Disable "Allow storage account key access."

Now, the only issue I have is with the deployment and Kudu trace logs. CI/CD is throwing the following exception:

Can anyone provide a solution for this? We are not allowed to enable the "Allow storage account key access." However, when we enable account key access, the CI/CD deployment for the function app succeeds.