diff --git a/compiler/src/dotty/tools/dotc/typer/Inferencing.scala b/compiler/src/dotty/tools/dotc/typer/Inferencing.scala
index 520c8bf62ba4..6f5dc86193a7 100644
--- a/compiler/src/dotty/tools/dotc/typer/Inferencing.scala
+++ b/compiler/src/dotty/tools/dotc/typer/Inferencing.scala
@@ -444,7 +444,9 @@ object Inferencing {
   }
 
   /** The instantiation decision for given poly param computed from the constraint. */
-  enum Decision { case Min; case Max; case ToMax; case Skip; case Fail }
+  enum Decision:
+    case Min, Max, ToMax, Skip, Fail
+
   private def instDecision(tvar: TypeVar, v: Int, minimizeSelected: Boolean, ifBottom: IfBottom)(using Context): Decision =
     import Decision.*
     val direction = instDirection(tvar.origin)
diff --git a/compiler/src/dotty/tools/dotc/typer/Synthesizer.scala b/compiler/src/dotty/tools/dotc/typer/Synthesizer.scala
index 761a24e10474..cb3bba1cf0e4 100644
--- a/compiler/src/dotty/tools/dotc/typer/Synthesizer.scala
+++ b/compiler/src/dotty/tools/dotc/typer/Synthesizer.scala
@@ -29,17 +29,21 @@ class Synthesizer(typer: Typer)(using @constructorOnly c: Context):
   private type SpecialHandlers = List[(ClassSymbol, SpecialHandler)]
 
   val synthesizedClassTag: SpecialHandler = (formal, span) =>
-    def instArg(tp: Type): Type = tp.stripTypeVar match
-      // Special case to avoid instantiating `Int & S` to `Int & Nothing` in
-      // i16328.scala. The intersection comes from an earlier instantiation
-      // to an upper bound.
-      // The dual situation with unions is harder to trigger because lower
-      // bounds are usually widened during instantiation.
+    def instArg(tp: Type): Type = tp.dealias match
       case tp: AndOrType if tp.tp1 =:= tp.tp2 =>
+        // Special case to avoid instantiating `Int & S` to `Int & Nothing` in
+        // i16328.scala. The intersection comes from an earlier instantiation
+        // to an upper bound.
+        // The dual situation with unions is harder to trigger because lower
+        // bounds are usually widened during instantiation.
         instArg(tp.tp1)
+      case tvar: TypeVar if ctx.typerState.constraint.contains(tvar) =>
+        instArg(
+            if tvar.hasLowerBound then tvar.instantiate(fromBelow = true)
+            else if tvar.hasUpperBound then tvar.instantiate(fromBelow = false)
+            else NoType)
       case _ =>
-        if isFullyDefined(tp, ForceDegree.all) then tp
-        else NoType // this happens in tests/neg/i15372.scala
+        tp
 
     val tag = formal.argInfos match
       case arg :: Nil =>
diff --git a/compiler/src/dotty/tools/dotc/typer/Typer.scala b/compiler/src/dotty/tools/dotc/typer/Typer.scala
index 819a66b52946..d33cf0883268 100644
--- a/compiler/src/dotty/tools/dotc/typer/Typer.scala
+++ b/compiler/src/dotty/tools/dotc/typer/Typer.scala
@@ -4361,12 +4361,23 @@ class Typer(@constructorOnly nestingLevel: Int = 0) extends Namer
               implicitArgs(formals2, argIndex + 1, pt)
 
             val arg = inferImplicitArg(formal, tree.span.endPos)
+
+            def canProfitFromMoreConstraints =
+              arg.tpe.isInstanceOf[AmbiguousImplicits]
+                    // ambiguity could be decided by more constraints
+              || !isFullyDefined(formal, ForceDegree.none)
+                    // more context might constrain type variables which could make implicit scope larger
+
             arg.tpe match
-              case failed: AmbiguousImplicits =>
+              case failed: SearchFailureType if canProfitFromMoreConstraints =>
                 val pt1 = pt.deepenProtoTrans
                 if (pt1 `ne` pt) && (pt1 ne sharpenedPt) && constrainResult(tree.symbol, wtp, pt1)
-                then implicitArgs(formals, argIndex, pt1)
-                else arg :: implicitArgs(formals1, argIndex + 1, pt1)
+                then return implicitArgs(formals, argIndex, pt1)
+              case _ =>
+
+            arg.tpe match
+              case failed: AmbiguousImplicits =>
+                arg :: implicitArgs(formals1, argIndex + 1, pt)
               case failed: SearchFailureType =>
                 lazy val defaultArg = findDefaultArgument(argIndex)
                   .showing(i"default argument: for $formal, $tree, $argIndex = $result", typr)
diff --git a/tests/neg/i9568.check b/tests/neg/i9568.check
index 3f318d0b0111..744023714a69 100644
--- a/tests/neg/i9568.check
+++ b/tests/neg/i9568.check
@@ -4,13 +4,10 @@
    |          No given instance of type => Monad[F] was found for parameter ev of method blaMonad in object Test.
    |          I found:
    |
-   |              Test.blaMonad[F², S](Test.blaMonad[F³, S²])
+   |              Test.blaMonad[F², S]
    |
-   |          But method blaMonad in object Test does not match type => Monad[F²]
+   |          But method blaMonad in object Test does not match type => Monad[F]
    |
    |          where:    F  is a type variable with constraint <: [_] =>> Any
    |                    F² is a type variable with constraint <: [_] =>> Any
-   |                    F³ is a type variable with constraint <: [_] =>> Any
-   |                    S  is a type variable
-   |                    S² is a type variable
    |          .
diff --git a/tests/pos/i23526.scala b/tests/pos/i23526.scala
new file mode 100644
index 000000000000..e530608435c7
--- /dev/null
+++ b/tests/pos/i23526.scala
@@ -0,0 +1,14 @@
+trait B[-A, +To] {
+  def addOne(e: A): this.type = this
+  def res(): To
+}
+
+class Col[A]
+
+object Factory {
+  def newB[A](using reflect.ClassTag[A]) = new B[A, Col[A]] { def res(): Col[A] = new Col[A] }
+}
+
+def test =
+  val a = Factory.newB.addOne(1).res()
+  val b = collection.immutable.ArraySeq.newBuilder.addOne(1).result()