Logging in with "system" results in 401 error regardless of account existence

Steps to reproduce:

1. At the login screen, input "system" for user, and any value for password (can be blank as well) and click the Log In button / enter key.
2. Observe navigation to <host:port>/nuxeo/startup, 401 error in browser console, and the following message displayed:

Please log in at: https://nightly.nuxeo.com/nuxeo/login 

*NOTE: this is reproducible even after creating a user account with id "system" and defining a password (e.g. "pass"). If not a bug, why does this occur?