The symptoms do look a bit viral, though it's hard to be certain as they can only be confirmed with a lab test (which may be expensive; plus, several viruses can infect peony). Some viral infections will kill the plant, gradually reducing its vigor, while others seem to have minimal impacts, though all are capable of spreading to other plants and are not curable. If you are wary of this peony's symptoms and suspect it's infected with a virus, it might be prudent to discard it. The soil itself won't be contaminated per se, but if this is one of the nematode-vectored viruses, if root nematodes exist in that planting site, they might be able to re-infect a new plant put in its place (at least, among the vulnerable hosts, like another peony).

Miri