DVC with Azure Blob Storage, blobs get deleted after second dvc push

Question

I am using DVC (Data Version Control) with Azure Blob Storage as remote. The connection works. I added two files and when I ran dvc push the blobs appeared in my storage container on Azure. However, when I ran dvc push another time, the blobs got the 'deleted' status, only showing when I switched 'Show deleted blobs' to 'on' in the Azure storage container UI.
dvc version outputs:

dvc version
DVC version: 3.42.0 (pip)
-------------------------
Platform: Python 3.9.12 on Windows-10-10.0.19045-SP0
Subprojects:
        dvc_data = 3.8.0
        dvc_objects = 3.0.6
        dvc_render = 1.0.1
        dvc_task = 0.3.0
        scmrepo = 2.0.4
Supports:
        azure (adlfs = 2023.12.0, knack = 0.11.0, azure-identity = 1.15.0),
        http (aiohttp = 3.9.1, aiohttp-retry = 2.8.3),
        https (aiohttp = 3.9.1, aiohttp-retry = 2.8.3)
Config:
        Global: C:\Users\*****\AppData\Local\iterative\dvc
        System: C:\ProgramData\iterative\dvc
Cache types: hardlink
Cache directory: NTFS on C:\
Caches: local
Remotes: azure
Workspace directory: NTFS on C:\
Repo: dvc, git

The output of dvc config -l is:

remote.myremote.url=azure://container/datasets
remote.myremote.version_aware=true
remote.myremote.account_name=storageacc
core.remote=myremote
core.autostage=true
remote.myremote.connection_string=***
remote.myremote.account_key=***

Can someone tell me if this is intended functionality of dvc or if it's a bug?