ADServiceAccount as Proxy Account for SQL Server Agent To schedule SSIS packages from SSISDB

I want to use a Managed ADServiceAccount created using the following powershell command as a proxy account to schedule and execute ssis packages :

New-ADServiceAccount -Name seraccname -Enable $true -DNSHostName domainname.local
Set-ADServiceAccount -Identity seraccname -PrincipalsAllowedToRetrieveManagedPassword  serv1.domainname.local
Install-ADServiceAccount seraccname 

But when i use that account as a crediantion in SQL Server. SSMS expects a password and gives me this error.

"The secret stored in the password field is blank".

However these type account dont have a password as they are managed by AD. Then i tought i was smart and i used the following sql code to force create the credientials without a password

USE[master]
GOCREATE CREDENTIAL [seracccred]WITHIDENTITY='domainname.local\seraccname$'
GO

I then created a proxy with that credential, used it in a job step (run as) But when i execute the job step i get the following error.

Error authenticating proxy domainname.local\seraccname$, system error, username or password is incorrect

I gave the service account the required permissions to work with SSISDB. but i think thats not the issue. i dont know why SQL Server Agent or SQL server or whatever is expecting a password. I am using SQL Server 2012

Finally, i want to mention that i am reproducing a problem so i dont want an alternative solution . I just want to use an active directory managed service account to execute the job steps and ssis packages.

I think i really misunderstand something here and there is no documentation about this at all which is weird as i see it as a very valid usecase to use managed AD service account to be used as the "run as" of the ssis jobs