Virtual Machines (VMs) are failing to receive IP addresses from NSX in a TKGm 2.5.4 environment, significantly disrupting production workloads across multiple clusters and numerous VMs. The issue is evidenced by kubectl describe output showing the status "WaitingForIPAllocation" and "VirtualMachineProvisioned: NotProvisioned" for the affected virtualmachine and machine resources.
The underlying cause is a failure in the ESXi host(s) scratch storage being decommissioned which was used by the nest-db service, which consequently prevents the nest-db agent from successfully starting on the affected ESXi host(s). The nest-db agent is essential for NSX-T's network communication and dynamic IP assignment.