Both. Facebook scans form fields for content that can be uploaded [0], and a developer can upload hashed data (I believe potentially from their backends[1][2]).
> Automatic advanced matching will tell your pixel to look for recognisable form fields and other sources on your website that contain information such as first name, last name and email address. The Facebook pixel receives that information along with the event, or action, that took place. This information gets hashed in the visitor's browser. We can then use the hashed information to more accurately determine which people took action in response to your ad. After matching, we promptly discard the hashed information.
> The manual method feature enables advertisers to leverage their own customer data, such as email address, phone number and so on. This method allows advertisers to report on more conversions, optimise their ads against more conversion data and reach more people on Facebook with their website Custom Audiences or dynamic ads.
[0] https://www.facebook.com/business/help/611774685654668?id=12...
> Automatic advanced matching will tell your pixel to look for recognisable form fields and other sources on your website that contain information such as first name, last name and email address. The Facebook pixel receives that information along with the event, or action, that took place. This information gets hashed in the visitor's browser. We can then use the hashed information to more accurately determine which people took action in response to your ad. After matching, we promptly discard the hashed information.
[1] https://developers.facebook.com/docs/facebook-pixel/advanced... - technical specs for uploading hashed user content. Typically done on the frontend.
[2] https://www.facebook.com/business/m/signalshealth/accelerate...
> The manual method feature enables advertisers to leverage their own customer data, such as email address, phone number and so on. This method allows advertisers to report on more conversions, optimise their ads against more conversion data and reach more people on Facebook with their website Custom Audiences or dynamic ads.