With Switch 1, Nintendo was offering the cards of following sizes in GBs: 2, 4, 8, 16, 32. With Switch 2, they only offer 64GB or a game key card with probably like a few Mbs. Clearly they're trying to kill physical media. 64Gb cards are ridiculously expensive, especially for small and indie devs. They can still order their games as Switch 1 card with upgrade for Switch 2 via online update. But the situation for the foreseeable future of physical media is grim.
Again, this is Nintendo itself pushing the physical media out. If they didn't, they would offer more options for Switch 2 cards