They probably had worked on this feature for some time and are using the current times as an opportunity to introduce it. It's hard to believe they had the capacity to react to the traffic increase and develop a sharp new feature in less than a week.
If you look at the code it's not that far fetched. The facial recognition uses "off the shelf" third party libraries and a gaussian blur isn't exactly rocket science.
I don't know how much work goes into making a new Signal release but it terms of raw coding it's like two days of work.
