New update - world completely glitches when microsoft friends join

The world is relatively stable when it is just me - like I wouldn't go exploring or anything but I can build. The only problem then was when friends joined no mobs would spawn unless we were together.

 

When I have a friend join through Microsoft the entire world glitches out with the new update, we cant even break or place blocks. If you try to they just instantly disappear for a couple of minutes then respawn without dropping anything. If you are standing in the way when the block reappears you will die.