Cannot read button state from user space application

Question

I have build custom image for Raspberry Pi 4 using Yocto. I connected microswitch to GPIO17 and I want to read its state in user space application. The event occures when I press switch, which I'm 100% sure because I patched gpio-keys driver adding custom log messages:

 [  185.053346] <gpio_keys_gpio_isr>
 [  185.076626] <gpio_keys_gpio_report_event> type: 1 | code: 777 | state: 0
 [  185.265685] <gpio_keys_gpio_isr>
 [  185.268975] <gpio_keys_gpio_isr>
 [  185.292253] <gpio_keys_gpio_report_event> type: 1 | code: 777 | state: 1

But for some reason I cannot read button state from user space application:

#include <stdio.h>
#include <fcntl.h>
#include <sys/ioctl.h>
#include <linux/input.h>
#include <string.h>
#define DP_EVENT_INPUT "/dev/input/event0"

int main(int argc, char **argv) {

   unsigned int key_states[2];
   struct input_event evt;
   int fd;

   memset(key_states, 0, sizeof(key_states));

   if ((fd = open(DP_EVENT_INPUT, O_RDONLY)) < 0)
   {
       if (errno == EACCES && getuid() != 0) {
           fprintf(stderr, "You do not have access to %s. Try "
                "running as root instead.\n",
                DP_EVENT_INPUT);
           exit(EXIT_FAILURE);
       }
   }

   while(1) {

      ioctl(fd, EVIOCGKEYCODE, key_states);
      if(read(fd, &evt, sizeof(struct input_event)) > 0) {

          if(evt.type == EV_KEY) {
             printf("EVENT type: EV_KEY\n");
          }
          else {
             printf("No event!\n");
          }
      }
    }
  }

Application hangs on read() call... From here I read that to read button state I need to use ioctl with EVIOCG* value so I used EVIOCGKEYCODE which means: "get keycode". Bellow I attaching my device tree overlay:

   /dts-v1/;
   /plugin/;

   #include <dt-bindings/pinctrl/bcm2835.h>
   #include <dt-bindings/gpio/gpio.h>
   #include "dt-bindings/input/linux-event-codes.h"
   

 / {

   compatible = "raspberrypi,4-model-b", "brcm,bcm2711";

    fragment@0 {
            target = <&gpio>;
            __overlay__ {
        // Configure the gpio pin controller
        buttonpin: button-gpio {
            brcm,pins = <17>;
            brcm,function = <BCM2835_FSEL_GPIO_IN>;
            brcm,pull = <BCM2835_PUD_UP>;
                };
    };
    };

fragment@1 {
    target-path = "/";
    __overlay__ {

        gpio-keys {
            compatible = "gpio-keys";
            pinctrl-names = "default";
            pinctrl-0 = <&buttonpin>;
            status = "okay";
            
            sw1 {
                label = "GPIO Key USER1";
                linux,code = <777>;
                linux,input-type = <EV_KEY>;
                debounce-interval = <20>;
                gpios = <&gpio 17 GPIO_ACTIVE_LOW>;
            };
        };
    };
};

};

Can anyone tell me what I'm doing wrong?

Thanks