4 directional animation

Hello

I am thinking about the best way to animate my 2d character. I have a sprite sheet for walking in 4 directions and fighting in 4 directions.

After reading multiple posts. There are 2 ways for making fsm for this.

Either have 2 blendtree states (walk and fight). In each of these, I will have the 4 directions. OR Have fsm with 8 states corresponding to each (action, direction) combination.

Why would I go for one over the other? Or is there a better way?

Thanks