Using the tech built for the likes of CS:GO, Destiny 2, and Dota 2 - Valve has officially rolled out the new Steam Chat Filtering across the rest of Steam.
So now this means you can have a consistent experience across supported games, the Steam desktop client, web, and mobile chat experiences. The key thing is that it's optional, you can turn it off or turn it up as the choice is still mostly down to users on what they want to see. As a default, Valve has turned it on to block "strong profanity and slurs" from people you don't know. These settings can be changed any time here.
Valve said they continue to invest in systems for store and community content moderation, which are enabled by default. However, this was put in place so users get a little more control over what they want and don't want to see from others and at "user and partner requests". They already ban profanity and slurs from prominent public-facing areas on Steam but they don't want to outright block it and just let users choose instead.
The default lists they built up should block commonly used strong profanity, along with "commonly used slurs against various racial, religious, ethnic, and other identifying groups".
Game developers can make use of it for online chat if they wish too, it's not limited to the big titles. You can find info on how to use it here.
See their announcement here.