Working locally, but not on the prod server (maybe some domains issue)

[Vetlin]

I am using auth next with laravel sanctum provider to communicate with laravel api. On my local I have nuxt app on port 3000 and laravel app on port 8000, so the urls are http://localhost:8000 and http://localhost:3000 💬
Also I have prod server set like this
Nuxt - http://maindomain.com
Laravel Api - http://api.maindomain.com

Here is my nuxt.config.js file

export default {
// Disable server-side rendering: https://go.nuxtjs.dev/ssr-mode
ssr: false,

// Global page headers: https://go.nuxtjs.dev/config-head
head: {
    titleTemplate: '%s - Linevich Auto',
    title: 'LinAuto',
    htmlAttrs: {
        lang: 'en'
    },
    meta: [
        {charset: 'utf-8'},
        {name: 'viewport', content: 'width=device-width, initial-scale=1'},
        {hid: 'description', name: 'description', content: ''}
    ],
    link: [
        {rel: 'icon', type: 'image/x-icon', href: '/favicon.ico'},
        {rel: 'preconnect', href: 'https://fonts.gstatic.com'},
        {rel: 'stylesheet', href: 'https://fonts.googleapis.com/css2?family=Ubuntu:ital,wght@0,300;0,400;0,500;0,700;1,300;1,400;1,500;1,700&display=swap'},
    ]
},

// Global CSS: https://go.nuxtjs.dev/config-css
css: [],

// Plugins to run before rendering page: https://go.nuxtjs.dev/config-plugins
plugins: [],

// Auto import components: https://go.nuxtjs.dev/config-components
components: true,

// Modules for dev and build (recommended): https://go.nuxtjs.dev/config-modules
buildModules: [
    // https://go.nuxtjs.dev/vuetify
    '@nuxtjs/vuetify',
    '@nuxtjs/dotenv',
],

// Modules: https://go.nuxtjs.dev/config-modules
modules: [
    '@nuxtjs/axios',
    '@nuxtjs/auth-next',
],

// Axios module configuration: https://go.nuxtjs.dev/config-axios
axios: {
    proxy: true,
    credentials: true,
},

// Build Configuration: https://go.nuxtjs.dev/config-build
build: {},

auth: {
    redirect: {
        login: '/user/login',
        logout: '/',
        callback: '/login',
        home: '/'
    },
    strategies: {
        laravelSanctum: {
            provider: 'laravel/sanctum',
            url: process.env.API_URL,
            endpoints: {
                login: {url: '/api/user/login', method: 'post'},
                user: {url: '/api/user', method: 'get'}
            }
        },
    },
},
proxy: {
    '/laravel': {
        target: 'https://laravel-auth.nuxtjs.app',
        pathRewrite: { '^/laravel': '/' }
    }
},

}
Here is my login logic on login page

export default {
name: "login",
data: () => ({
email: '',
password: '',
}),
methods: {
async login() {
await this.$auth.loginWith('laravelSanctum', {
data: {
email: this.email,
password: this.password,
},
})
this.$router.push('/admin')
},
},
}
Admin page is under auth middleware.

So the problem is that on my local auth happens successfully, but when I try to login on prod server - nothing happens. In network I see that backend returned successful response, but I'm still on login page. I debug it a little bit, I log to console the state of this.$auth.user after login but before redirect, and on local it is returning user object as expected, but on prod - false.

So what can be the issue here? Is it related to the laravel api subdomain?