Issue with Websockets/Peerjs on production (Nginx) - node.js

Question

I'm facing an issue with peerjs on nginx. The same code works fine on localhost, but doesn't work when I host it on a production sereverv via Nginx. Following the code below, two peers can connect to and regcognize eachother, but can't communicate when I try to send an image over.
I have added some comments in the frontend code, where I suspect the error. Can anyone help me please? Thanks :)
Here is the backend code:
const fs = require('fs');
const express = require('express');
const { ExpressPeerServer } = require('peer');
const app = express();
app.get('/', (req, res, next) => res.send('Hello world!'));
const sslOptions = {
key: fs.readFileSync('/etc/letsencrypt/live/<server_URL>/privkey.pem'),
cert: fs.readFileSync('/etc/letsencrypt/live/<server_URL>/fullchain.pem')
}
const server = app.listen(5000);
const peerServer = ExpressPeerServer(server, {
path: '/myApp',
debug: true,
proxied: true,
ssl: sslOptions
});
app.use('/peerjs', peerServer);
Frontend:
const peerConfig = {
secure: true,
host: '<server_URL>',
path: '/peerjs/myApp',
debug: 3
}
const peer = new Peer('any_ID_1', peerConfig);
console.log(peer) // this works fine and the object has "_open:true"
const conn = peer.connect('any_ID_2');
console.log(conn) // however, the object here returns "_open:false"
Nginx conf:
server{
server_name <server_URL>;
root /var/www/backend;
location / {
proxy_pass http://localhost:5000;
proxy_set_header Host $host;
proxy_set_header X-Real-IP $remote_addr;
proxy_set_header X-Forwarded-For $proxy_add_x_forwarded_for;
proxy_http_version 1.1;
proxy_set_header Upgrade $http_upgrade;
proxy_set_header Connection 'upgrade';
proxy_cache_bypass $http_upgrade;
}
listen 443 ssl; # managed by Certbot
ssl_certificate /etc/letsencrypt/live/<server_URL>/fullchain.pem; # managed by Certbot
ssl_certificate_key /etc/letsencrypt/live/<server_URL>/privkey.pem; # managed by Certbot
include /etc/letsencrypt/options-ssl-nginx.conf; # managed by Certbot
ssl_dhparam /etc/letsencrypt/ssl-dhparams.pem; # managed by Certbot
}