Just saying ... I haven't read the whole discussion so this was maybe proposed at some point.
I had the same issue.. and while I was trying to figure why authenticator was deleting the accounts, I saw that option not being activated in the lastpass application (not the authenticator): "Authorize Apple Watch". It was off. (On the iPhone: Lastpass app / settings / security )
I first though this was not an option for the authenticator but fort lastpass anyway.. But since searching for the authenticator on the apple store returned no results on the watch on the opposite of the iPhone, I realized that the authentication on the watch was imbedded into the lastpass app for the watch. So on the opposite of the phone, the watch has only one application while on the phone that's 2 applications. That's maybe what created the confusion for many of you too since at first, I was thinking that lastpass and the authenticator were 2 different and independent apps on the watch too.
So anyway, I activated the option "Authorize Apple Watch" in lastpass on the iPhone and so far, so good. I had also activated "Use Apple Watch Pin Code" but this might not be related... just saying in case that makes a difference but I wouldn't see why.
So, so far so good... But hey, I haven't test it for days and even not hours... So who knows.. it can maybe still fail after a while.. Time will tell.. You have to try out ..
As for the reason this happened, I'm on the impression that when the application is not authorized, there's a protection that deletes the accounts.. maybe.. Now the behavior is so important that we should have gotten a prompt to activate the option...
Anyway.. good luck and if this works let us know!
Same thing happened to me recently. Even worse is that I couldn't restore from backup. Good to know that maybe it's my Apple Watch making things go haywire. I can avoid using it with Authenticator.
A Lastpass support rep told me that the backup only happens the first time you turn on the backup in settings. So only two of my accounts were backed up, since I turned on the backup when I only had two stored. Makes no sense. At. All.
At the very least, if this is the way it works, Lastpass should set it up as a "back up now" button rather than a toggle that makes you think it's backing up regularly. Even an employee answered this incorrectly on a recent thread.