According to Zach Lowe of ESPN, "Memphis has continued to insist in talks that they will trade Iguodala, sources say, and not buy him out."
The veteran was traded to the Grizzlies from the Golden State Warriors in July but has sat out the season to this point.
While the Grizzlies were expected to be rebuilding in 2019-20, they have surprised with a 24-25 record entering Monday, placing them in the final playoff spot in the Western Conference.
However, Iguodala is looking to play for a title contender after winning three championships with Golden State.
"I feel like I still have a lot to give," he said on ESPN's First Take on Jan. 24 (h/t Luke Adams of Yardbarker). "So hopefully the right situation comes about for myself and the Memphis Grizzlies as well."
The Grizzlies could buy out the remainder of the $17.2 million owed to him this season, but it seems they would prefer to get something of value in a trade.
Tim MacMahon of ESPN previously reported the team's "fallback option" would be a deal with the Dallas Mavericks for Courtney Lee and the rights to the Warriors' 2020 second-round pick. Lowe said the Los Angeles Clippers could provide a package led by Maurice Harkless and a first-rounder.
A bidding war could drive the price up in the final days before Thursday's deadline, but the Grizzlies' desperation to make a deal might limit any potential upside in a return.