As a DM, it was pretty clear that Campaign 2 was close to ending. When the party has an extra-dimensional tower they can pop into to rest up in, more or less on demand, there's very few ways left to challenge the party unless you're willing to completely wreck the campaign setting along the way.
Mercer would have no difficulty challenging this party through 20th level - as evidenced by him doing the same thing in campaign one ((when they had an extra-dimensional Scanlan Shorthand Magnificent Mansion.
Further, Mercer has made it clear that there will be 'further adventures' for the Mighty Nein - just as there were for Vox Machina. They will get to those higher levels.
The end right now is a combination of:
1.) Taking a break from the game at campaign end.
2.) Wanting to take that break at a time that makes sense for the studio changes that will bring them all back to the table.
3.) Wanting to preserve a few 'levels' that can be added in those future adventures.
I still do not get this fear that DMs have of higher levels. The game changes as PCs advance. Things that were a challenge at lower levels become trivial at higher, but there is still a tone of ways to keep the game interesting. For example: Powerful enemies understand that powerful PCs, when fully rested, are very capable - so they set the stage to deplete PC resources within a short period of time before they go in for the kill.
Or There is a clock (or the PCs are concerned there is a clock) on what the PCs must achieve, requiring them to complete a task within X hours (which puts a cap on how much they can rest).
Or The DM designs the final encounter with the assumption the PCs will have a chance to be fully rested and designs it to have several phases (just like Mercer did for this last storyline) giving the PCs chances to deplete those resources ... a tactic that gets more drama when the PCs have no clue there will be multiple phases. High level D&D is different than low level D&D, but it is fun when you treat it like a high level game and stop lamenting you can't use your low level tricks on the party.