Before my dog would lay down, he would often paw at his chosen spot and precede to circle the area. This ritual is similar to the behavior displayed by wild dogs when digging shelters

The behavior is found in all dogs ( they paw to find a good spot and they circle to scan for external threats )

Explanation:

The digging/pawing at a chosen spot or shelter by a dog is in a bid to find a comfortable place with the appropriate temperature devoid of external threat to rest or sleep at the moment.

While the circling of the area by the dog is one way to scan the area for security threats in the area or in close proximity and also to tell/scare other dogs from coming to interrupt their rest/sleep so this ritual is performed by both wild and domestic dogs.