HKT error report not that clear.

[ShuiRuTian]

Compiler version

3.0.0RC1
If you're not sure what version you're using, run print scalaVersion from sbt
(if you're running scalac manually, use scalac -version instead).

Minimized example

// This is OK
class FunctorImpl[Generic1[T] <: Iterable[T]]{}
class HKT3_1[Functor[Generic2[T]<:Set[T]]]{}
var h = new HKT3_1[FunctorImpl]();

// This is has error
class FunctorImpl[Generic1[T] <: Iterable[T]]{}
class HKT3_1[Functor[Generic2[T<:String]<:Set[T]]]{}
var h = new HKT3_1[FunctorImpl]();
// Error: Type argument FunctorImpl does not conform to upper bound [Generic2[T] <: Set[T]] =>> Any

Output

No output

Expectation

I am not sure, maybe [Generic2[T<:String] <: Set[T]] =>> Any? However, current error message is not enough.
And it would be nice to explain why it is not work in detailed.