Data URI svg is not supported on custom properties

[nex3]

From sass/sass#2494:

test {
  --background-image: url('data:image/svg+xml;utf8,<svg viewBox="0 0 200 200" xmlns="http://www.w3.org/2000/svg"><circle cx="100" cy="100" r="100"/></svg>');
  background-image: var(--background-image);
}

Fails with:

Error: Invalid CSS after "...kground-image: ": expected "}", was "url('data:image..."
        on line 2 of style.scss
  Use --trace for backtrace.

Assigning string to a variable and then url($icon) works, which is quite odd.

Ruby Sass 3.5.6