According to Dave Meltzer of the Wrestling Observer Radio, a multitude of factors have caused Rey Mysterio to not sign a new contract with WWE. The veteran performer is currently a free agent, but negotiations between both parties are currently ongoing.
As documented by Sportskeeda, the first reason for the hold-up is money. Mysterio reportedly wants a pay raise and isn't willing to budge on the matter. The promotion has been cutting costs in recent months due to economic uncertainty pertaining to the COVID-19 pandemic. Mysterio was already on a big deal, and officials are apparently hesitant about increasing the value.
The superstar is also worried about the length of his proposed new deal. WWE wants the performer to extend his stay by another five years, but he is only willing to commit to another 18 months. He is supposedly set on receiving his desired tenure, as well as the pay increase. Mysterio is currently 45 years old, so perhaps his age is factoring into his desire for a shorter length.
The future of his son, Dominik, has also played a part in the hold-up. Mysterio wants to make sure his family member gets offered a contract as well. The legendary luchador has been open about his desire to compete against Dominik down the line, and company executives also seem to be keen on the storyline potential of having both performers on the roster at the same time.
Despite not being able to reach an agreement, Meltzer stated that WWE and Mysterio are still on good terms with each other. It is expected that they'll be able to negotiate new terms very soon. Officials hoped to have the situation wrapped up before Extreme Rules, and the failure to do so is why Mysterio lost his eye as part of a storyline at the pay-per-view.
If Mysterio doesn't stay, he's been written off of television. However, the company also ended the angle on an ambiguous note so that there's a valid explanation for his return. However, if he does go to another company, the belief is that he won't sell his loss of eyesight storyline.
Vince McMahon is supposedly overseeing the process personally, suggesting that they're very keen on having the legend stick around. Triple H usually handles negotiations, but Mysterio is a special case. The boss will also be very wary of the prospect of the legend jumping ship to All Elite Wrestling or another rival promotion.