Thanks for the information. Assuming all last 11 blocks have exactly 10 minutes interval, does that mean block with timestamp about 1 hour in past still accepted?
Exactly. To my understanding using timestamps embedded in blocks for reference offers less attack surface than relying on a network time that is not protected by PoW (as is the case with the 2 hours into the future rule). However nodes obviously can't access future block timestamps so they have to fall back on their local time plus a network time offset.
Note however that this only means that the block is
accepted, the timestamp has no influence on the ordering. If a node already has a valid block at the same height it will usually discard any competing block, regardless of the competing block having an earlier timestamp (as the timestamps can be easily faked). As far as I know that is implementation dependent however and not ruled by the protocol.
