I have spent hours over the last days trying to fix this for 2 kids who are distraught to be locked out of their game.
I have been through all of the trouble shooting I can find, I’ve been through all the steps provided by Mojang support and still have the same problem. I know it is not the PCs or the installations of Minecraft etc as I am able to switch the account in the launcher to my own, launch bedrock and it is signed straight in, close Bedrock and add one of my children’s accounts and they instantly get Drowned.
And I can also confirm that the workaround WORKS!
Start Bedrock as normal
Get to the drowned error
Disable the internet connection (wifi or ethernet, which ever is used)
Click sign in in Bedrock and the account is signed in
Enable the internet connection and play as normal