Azure recently experienced a blobs-deletion incident in Managed Service, where active databases' corresponding blob entries were erroneously selected for deletion. During the recovery process, it was discovered that Azure containers couldn't restore versioned blob entries deleted using the seven-day Blob Versioning policy. This led to testing and verifying various options around Soft-Delete and Versioning provided by Azure to ensure data loss prevention during accidental blob deletions. The correct configuration involves setting a lifecycle management rule with the name `versionrule` that deletes previous versions associated with a blob key after one day, and enabling the soft-delete policy with an expiration period of eight days. This ensures that deleted blob entries are permanently erased after seven days, while keeping track of all versioned data associated with a blob key.