[BUG] [Bug] Cowork fails to start on Windows - rootfs.vhdx corrupted, Access Denied (0x80070005) persists after full reinstall

Preflight Checklist

• [x] I have searched existing issues and this hasn't been reported yet
• [x] This is a single bug report (please file separate reports for different bugs)
• [x] I am using the latest version of Claude Code

What's Wrong?

Environment:

Claude Pro user
Windows 11 laptop
Cowork feature

Problem:
Cowork workspace fails to start. The file rootfs.vhdx is being rebuilt as corrupted after every reinstall attempt. Windows reports "Access is denied" (error 0x80070005) and Disk Management shows the disk image as uninitialized or unrecognizable.
Error message:
Failed to start Claude's workspace — HCS operation failed, VM service not running
What I have already tried:

Restarted laptop multiple times
Clicked "Reinstall Workspace" inside Claude
Updated Windows fully
Checked and updated file permissions
Ran Claude as Administrator
Deleted claudevm.bundle folder and vm_bundles folder
Completely uninstalled and reinstalled Claude fresh

Result: Same error returns every time. The vhdx file rebuilds itself as corrupted.
Suspected cause: Deep Windows permissions or Hyper-V configuration issue preventing correct file creation.
Request: Guidance from technical team on next steps.

What Should Happen?

Requesting Claude team's support to start using Claude Cowork asap.

Error Messages/Logs

Failed to start Claude's workspace. HCS operation failed: failed to start VM: HcsWaitForOperationResult failed with HRESULT 0x80070005: {"Error":-2147024891,"ErrorMessage":"Access is denied.","ErrorEvents":[{"Message":"","Provider":"51ddfa29-d5c8-4803-be4b-2ecb715570fe","EventId":12030,"Flags":13,"Data":[{"Type":"String","Value":"cowork-vm-f488f14c"},{"Type":"String","Value":"13388E95-5C89-5658-A615-5FFE7E9F1C3D"}]},{"Message":"","Provider":"51ddfa29-d5c8-4803-be4b-2ecb715570fe","EventId":12010,"Flags":5,"Data":[{"Type":"String","Value":"cowork-vm-f488f14c"},{"Type":"String","Value":"13388E95-5C89-5658-A615-5FFE7E9F1C3D"},{"Type":"String","Value":"Synthetic Storage"},{"Type":"String","Value":"%%2147942405"},{"Type":"String","Value":"0x80070005"},{"Type":"String","Value":"1FF46D3F-E712-5DBC-9813-AAD51981A2E9"},{"Type":"String","Value":""}]},{"Message":"'cowork-vm-f488f14c': Account does not have permission to open attachment 'C:\\Users\\USERNAME\\AppData\\Roaming\\Claude\\vm_bundles\\claudevm.bundle\\smol-bin.vhdx (Lun 1)'. Error: 'Access is denied.' (0x80070005). (Virtual machine ID 13388E95-5C89-5658-A615-5FFE7E9F1C3D)","Provider":"edacd782-2564-4497-ade6-7199377850f2","EventId":12290,"Flags":5,"Data":[{"Type":"String","Value":"cowork-vm-f488f14c"},{"Type":"String","Value":"13388E95-5C89-5658-A615-5FFE7E9F1C3D"},{"Type":"String","Value":"C:\\Users\\USERNAME\\AppData\\Roaming\\Claude\\vm_bundles\\claudevm.bundle\\smol-bin.vhdx (Lun 1)"},{"Type":"String","Value":"%%2147942405"},{"Type":"String","Value":"0x80070005"},{"Type":"String","Value":""},{"Type":"String","Value":""}]}],"Attribution":[{"OperationFailure":{"Detail":"Start"}},{"VirtualDeviceFailure":{"Detail":"PowerOnCold","Name":"Synthetic Storage","DeviceId":"d422512d-2bf2-4752-809d-7b82b5fcb1b4","InstanceId":"1ff46d3f-e712-5dbc-9813-aad51981a2e9"}}]}

Steps to Reproduce

all information above provided. Help with sorting this issue required please.

Claude Model

Sonnet (default)

Is this a regression?

No, this never worked

Last Working Version

not used before

Claude Code Version

2.1.96 (Claude Code)

Platform

Anthropic API

Operating System

Windows

Terminal/Shell

PowerShell

Additional Information

the errors included above.