Scratch that.
I managed to resolve this.
It has to do with my server sending binary messages.
I am not sure if the server I am connecting to changed the way they are sending data or is it some change done within the Unreal Engine.
I suspect the latter to be the case based on the things I’ve read on and looking at the UE 5.2 source code changes.
If anyone else faces the same issue, this Reddit thread pointed me in the right direction:
https://www.reddit.com/r/unrealengine/comments/14wpe2w/help_websocket_component_cannot_receive_messages/
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