Yes, it’s allowed but not recommended.
The Legacy apps have been removed from the app/play stores and the later versions of the Legacy apps prevent a new account being created - which makes life difficult with your local server.
Also, the Blynk local server code isn’t being updated, so there will eventually be vulnerabilities that aren’t fixed, and it won’t be updated to work with newer releases of Java.
Also, you shouldn’t underestimate the cost of running a local server in terms of hardware, power, admin and backup time etc. do you have the skills to set-up port-forwarding on your router, and a DDNS service if you don’t have a static public IP address?
Pete.