Switching cloud email requests from Basic Authentication to OAuth - how?

[Keith Jones]

The more I read about this, the more confused I get - but that's par for the course :)

We have been using a custom email address to feed requests into JSM Cloud. Now, it's failing - we have 2FA enabled. If we disable 2FA, it works.

Microsoft has terminated Basic Authentication. 

So it sounds like we need to reconfigure with OAuth?

Questions: 
I've seen information that says OAuth 2.0 is and isn't supported in the Cloud. Which?

Should we be focused on OAuth and not OAuth 2.0?

Is there a change that needs to be made on the Office 365 side to enable OAuth? If so, can you tell from the Jira side if that has taken place?