Two things I haven't seen mentioned that might be going on:
One, I think there's an evolving social strategy in queer activism that makes this a lot more "bipartisan" that mirrors something that happened in the unholy alliance of puritan feminism in the first wave. Essentially, we know that extreme right-wing politics have sex-negativity at their core, and one of the major right-wing strategies for demonizing LGBT folk is to sexualize them at every turn. Not only is actual sexual activity or public display of affection automatically more objectionable when coming from homosexual couples or visibly trans or queer people, but even basic information and activism is decried as sexual performance, often with the implication that presenting in these ways in public or educating people about LGBT is pornographic or "grooming" children (because, the logic goes, children are allowed in public and are receiving educational material). I think a really common reactionary response to this on the LGBT activist side is to present a sanitized "wholesome gay" as we see in a lot of culture right now. This obviously doesn't convince the actual bigots who are being disingenuous about their reasoning in the first place, but it does shift the mainstream overton window by countering that sexualizing rhetoric
I say this mirrors early feminist strategy because a key victory that strengthened the puritan-feminist alliance of was something of a reversal or at least muddying of the waters in gendered stereotypes about sexuality. Patriarchal Christianity had long held that women were intrinsically sexual beings, and thus incapable of the higher reason they claimed came from denial of worldly vices. This shows up in a lot of bible stories, of course, as well as screeds against women throughout the history of Christianity. But by the Victorian era, alongside efforts toward women's suffrage, more people started to view women as essentially asexual, and sexual desire to be primarily initiated by men. This was strengthened in the American prohibition era where orgs like the American Temperance Society aligned with suffrage groups and then this alliance passed the Volstead act together. This cultural shift had a lot of far-reaching cultural consequences (think "boys will be boys") but it was kind of a devil's bargain that let women argue in favor of their own mental competence via a logic many at the time would accept. It's a tactic with a lot of negative side effects, but in some senses it can be said to accomplish what it sets out to: Mainstreaming and assimilation. If a context where one is viewed as less than human because of some kind of atavistic sexuality, one way to argue for one's humanity is to demonstrate that one is in fact not a sexual being.
The second thing is that people's experience in general involves a lot less sexuality. Like it's been noted by a lot of people that factors such as the sprawl of suburbia and the decline of third places, especially for young people, the greater availability of online spaces due to advances in technology, and the increasing surveillance and paranoia inflicted on people in general but especially children (I think this is fed by not only technology but also by fearmongering propaganda, 24-hour news networks that thrive on sensationalism, and of course the aforementioned right-wing tactic of sexualizing things they don't like) causes less opportunity to explore and express sexuality, especially in a positive context. Also, some people seem to suspect that mass-prescribing SSRIs, especially to developing children, might be reducing actual physical sex drive in a massive swath of the population of rich countries. This is a known side-effect of a lot of anti-depressants.
Add all these factors up. Sex is less and less a part of people's actual lived experience. When you hear about sex, inevitably mostly in the media, it's to demonize someone or talk about scary stuff that's happening in the world. To a lot of people alive today, the first thing that comes to mind when they think of sex isn't intimacy they've experienced with other people, it's news reports of horrific rapes, copaganda about "sex trafficking", political rhetoric using sex to justify bigotry. Of course this stacks out to pervasive sex-negativity.
