The Mandalorian has established that, even years after the events of Return of the Jedi, the Empire hadn't been fully vanquished. Various Moffs still managed to maintain power throughout the Galaxy, and the assumption is that those remaining supporters of the Empire will eventually be key in the formation of The First Order.
In the case of Giancarlo Esposito's Moff Gideon, we'd bet on him being instrumental in Emperor Palpatine's resurrection. We know he's taken an interest cloning, and the deformed beings in that chamber we saw during the show's second season looked an awful lot like Supreme Leader Snoke.
At this point in the timeline, Palpatine is likely on Exegol trying to find a body to hold his essence, and a powerful being like Grogu could be exactly what he needs to create a new form.
Talking during a recent appearance at Fan Expo Canada (via SFFGazette.com), Esposito explained that Gideon is among those who, "when everything fell apart, there were wardens who were placed in different parts of this particular galaxy to maintain order."
He'd add that the apparent demise of the Empire means that "when everything falls apart, and you have no leadership, and everything is just crumbling, we all would want someone to stand up and have some kind of vision for how to be about all of us."
As Gideon has that vision, he's now "been given that wardenship over a particular part of geography land mass. And he sees that the other wardens aren't really as strong and powerful as him. He gets a taste of, 'Oh, I can straighten all this out,'" the actor continued added that his Imperial has become "drunk with the idea that his vision is better:"
Esposito would also reiterate the importance of Gideon saying "long live the Empire" last time we saw him, so expect that line to come into play when the villain returns in The Mandalorian's third season.
The sequel trilogy left fans with a long list of questions, and while some might argue that those movies are best left alone, it would be no bad thing for Lucasfilm to start filling in some of the gaps here.
The Mandalorian season 3 is expected to premiere on Disney+ in February 2023.