Hey, thanks for the report. I can see the screenshot with the provider error.
This is a common issue with Anthropic BYOK. Please check a few things:
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Anthropic credits: Make sure you have API credits at Billing | Claude Developer Platform.
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Conflicting settings: Go to Cursor Settings > Models and make sure Override OpenAI Base URL is turned off. If you have an OpenAI API key set, try turning it off for now too.
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MCP servers: If you have any MCP servers connected (Cursor Settings > Tools & MCP), temporarily disable all of them. For several users with the same error, this was the root cause: Again We're having trouble connecting to the model provider. This might be temporary - please try again in a moment
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New chat: Start a completely new chat thread after making these changes.
If none of that helps, try disabling HTTP/2: Cursor Settings > search for “HTTP/2” > enable “Disable HTTP/2”.
Let me know how it goes.