SD Notary 2 - Invalid credentials

I have been using SD Notary successfully for years without any issues. Now, when I try to use SD Notary 2 with exactly the same credentials I get:

12:54:57.916: Invalid credentials. Error: Error: HTTP status code: 401. Invalid credentials. Username or password is incorrect. Use the app-specific password generated at appleid apple com. Ensure that all authentication arguments are correct.

I even created a new app-specific password and try to enter different password combinations by selecting from the password pop-up list. Nothing gives…

Again, the old SD Notary still works fine.
Please help!

You need to create the app-specific password (for notarytool), then paste it into the password field when prompted for it. Unlike in the original SD Notary, you do not add it to your keychain.