Adding this as a help to anyone facing the same challenge:

WSO2 Identity Server supports Bcrypt from version 7.1.0 onwards. For IS 7.1.0, the support is provided through the Bcrypt Hash Provider Connector. You can find the configuration steps for this connector here: https://github.com/wso2-extensions/identity-hash-provider-bcrypt/blob/main/README.md.

Once the connector is set up, for this specific use case where the existing Bcrypt-hashed passwords need to be migrated, you can migrate the usernames and their corresponding password hashes directly into the WSO2 Identity Server user store schema using a carefully written database script. This way, users will be able to continue logging in with their existing passwords, and there’s no need to force a password reset flow.

If your migration scenario differs (eg: prompt users to reset their passwords), refer to the official WSO2 documentation for recommended migration approaches: https://is.docs.wso2.com/en/7.1.0/guides/users/migrate-users/