The other posters have it right. This other guy will kill your relationship if he gets the chance. He is a creep. You cannot let your wife keep seeing this guy and if she can't give him up you need to move on. No if or concessions on your part. You also better be careful she does not go underground.
If you decide you are open to her dating others at some point you can revisit it but not with this guy.
If your wife resents you and can't get over you not allowing her to shove this toxic guy down your throat , then that is on her. If you let her do this you will be a cuckold to her and this guy.
Good luck. Be strong