Consider a free theory and let $P^\mu = (H, \mathbf{P})$ be the 4-momentum operator. Since $P_\mu P^\mu = m^2$ is a Lorentz scalar, we get the relation $H^2 - |\mathbf{P}|^2 = m^2$. Here $H$ must be an eigenvalue $E$ of the Hamiltonian so that the momentum is on shell. With this requirement we get that the spectrum of the one particle state is all combinations of scalars $E$ and vectors $\mathbf{P}$ such that $E^2 - |\mathbf{P}|^2 = m^2$, which is a hyperboloid. We also have that the vacuum is the point at the origin. This describes the spectrum of $P^\mu$ for systems consisting of $n = 0, 1$ particles.
Assuming the above is all correct, I am unclear on why states consisting of two or more particles form a continuum in a rest frame with zero momenta. This is stated in Peskin & Schroeder and visualized in Figure 7.1 (page 213). A similar question was asked in another question (Why do the eigenvalues of the 4-momentum operator organize themselves into hyperboloids?), from which I know this somehow follows from boosts and Lorentz invariance, but I still do not fully understand why there is a continuum.
Can anyone explain why there is a continuum for $n \geq 2$ states and why there is a "bound state" between the $n = 1$ and $n = 2$ states in the figure? In a rest frame with two particle, why does $E^2 - |\mathbf{P}|^2 = 4m^2$?