Wordpress REST Api: add_action( 'rest_api_init', callback) does not call the callback

Problem:

I'm trying to register a custom endpoint for a Wordpress plugin. The problem I face is that when I call the add_action('rest_api_init', callback), the callback function is not being called. In that callback function lives the "register_rest_route()" method, which in it's turn is not being called and I am unable to register any custom endpoints.

• I'm using docker for development
• No errors are being thrown

Code:

public function register()
    {
        $this->setup_init();

    }
    
    public function setup_init()
    {
        var_dump('print1');

        add_action('rest_api_init', array($this, 'register_custom_endpoints'));
    }
    
    public function register_custom_endpoints()
    {

        var_dump('print2');
        die();

        register_rest_route('test', '/test', array(
            'methods'  => 'GET',
            'callback' => 'menu_setup',
        ));
    }

Question:

The code reaches the "var_dump('print1')", but the the "var_dump('print2')" is never reached. Am I missing something here?