KevinTheJedi
I created a ticket with Office 365 support and they recommended a test via powershell:
Let's first turn off MFA, Conditional Access Policies, Security Default.
Then you could run PowerShell commands below to narrow down done if the issue occurs within our side. If the PowerShell command can send successfully, then the issue occurs within just the app scope but not from our side.
$cred = get-credential
Send-MailMessage -To "user@domain.com" -from "user@domain.com" -Subject 'Test message' -smtpserver smtp.office365.com -usessl -Credential $cred -Port 587
The results of that test email were successful and I received it from one of the accounts that is used by OSTicket.