They still don’t allow sexually explicit material.
From their most recent policy:
Visual depictions of sexually explicit acts (or content with an overt focus on genitalia) are not allowed on Tumblr. That includes pictures, videos, GIFs, drawings, CGI, or anything similar. Historically significant art that you may find in a mainstream museum and which depicts sex acts—such as from India’s Śuṅga Empire—are now allowed on Tumblr with proper labeling.
Nudity and other kinds of adult material are generally welcome. We’re not here to judge your art, we just ask that you add a Community Label to your mature content so that people can choose to filter it out of their Dashboard if they prefer.
Their definition of sexually explicit is pretty narrow though in practice, there's still a significant chunk of Tumblr blogs that are 100% focused on sexual images and content without issue (and frankly were throughout the time when porn was banned since in practice Tumblr didn't put a tremendous amount of effort towards enforcement).
