Its definitely still computer generated. Its called styleGAN and anyone can do it. Need to train it with anime style artwork. Then styleGAN takes in a vector and outputs a picture, if you change the vector slightly you get a slightly different character which is how you get the smooth transitions and the whole transition could be an anime picture.

Anyways for this video after they trained their network, creators could've chosen vectors that match real life anime characters, then transitioned between them.