The problem was caused by Microsoft's decision to temporarily turn off network scanning:
The bug was caused by a Windows Defender scanner engine update that automatically disabled network scanning for newer versions, after previously having them enabled before the updates released during this month's Patch Tuesday.
Microsoft's decision to turn off network scanning in Windows Defender might have been prompted by a high network traffic issue as detailed in KB4052623's description.
"Enterprises that use Network Protection in either Audit or Block mode may experience greater than expected network traffic departing their networks to Microsoft Defender SmartScreen-associated domains," the knowledgebase article says.