Does two-factor authentication require one time use of one of the factors? Do we need one of the factors of two factor authentication to be one-time use?

TOTP and password are considered two factor authentication, but does smart card and password also count as two-factor authentication?
No.

The factors are:


something you know (for instance a password);
something you have (for instance a device containing a key for TOTP generation)
something that you are (for instance a fingerprint).


TOTP is not a factor in itself, it is a scheme that can be used to prove that you have the key / device).

There are however other ways of testing that you have something. If you bring a special amulet as "something that you have" then I could simply have a look at it after all. One time use is therefore not required.