Once upon a time (a long time ago), filtering and rejecting email based on the SMTP envelope sender (the SMTP MAIL FROM) was a generally sufficient mechanism to deal with many repeat spam sources. It didn't deal with all of them but many used their own domain in the envelope sender, even if they send from a variety of different IP addresses. Unfortunately, the rise of (certain) mail service providers has increasingly limited the usefulness of envelope sender address filtering, because an increasing number of the big providers use their own domains for the envelope sender addresses of all outgoing email. Unless you feel like blocking the provider entirely (often this isn't feasible, even on an individual basis), rejecting based on the envelope sender doesn't do you any good here.

This has made it increasingly useful to be able to do SMTP time rejection (and general filtering) based on the 'From:' header address. Many mail sending services will put the real spam source's email address in the From: and at least the top level domain of this will be consistent for a particular source, which means that you can use it to reject some of their customers but accept others. These days, MTAs (mail transfer agents) generally give you an opportunity to reject messages at the SMTP DATA phase, after you've received the headers and message body, so you can use this to check the From: header address.

(If you're applying per-destination filtering, you have the SMTP DATA error problem and may only be able to do this filtering if the incoming email has only a single recipient. Conveniently, the mail service providers that commonly obfuscate the envelope sender address usually send messages with only a single recipient for various reasons, including VERP or at least something that looks like it.)

I feel that From: address filtering works best on pseudo-legitimate sources of repeat spam, such as companies that are sending you marketing email without consent. These are the senders that are least likely to vary their top level domain, because they have a business and want to look legitimate, be found at a consistent address, and build up reputation. These are also the sources of unwanted email that are the least likely to be dropped as customers by mail service providers (for a collection of likely reasons that are beyond the scope of this entry).

There are plenty of potential limitations on From: header address filtering. Bad actors can put various sorts of badly formed garbage in the From:, you definitely have to parse it (ideally your MTA will provide this as a built-in), and I believe that it still technically might have multiple addresses. But as a heuristic for rejecting unwanted mail, all of this is not a serious problem. Most From: addresses are well formed and good, especially now that DMARC and DKIM are increasingly required if you want the large providers to accept your email.

(DKIM signing in 'alignment' with the From: header is increasingly mandatory in practice, which requires that the From: header has to be well formed. I don't know how Google and company react to badly formed or peculiar From: headers, but I doubt it helps your email appear in people's inboxes.)

PS: While you can filter or discard email based on the From: header in a variety of places, I like rejecting at SMTP time and it's possible that SMTP rejections at DATA time will trigger anti-spam precautions in the mail service providers (it's a possible signal of badness in the message).