Exactly. And who pays for all the damage when they are hacked and hackers decrypt your account information?
Moreover, the way 1Password is choosing to respond to queries about local storage gives me pause about how they would handle a security breach. (Hint: like politicians, they are refusing to answer the questions posed about retaining a local storage option in future versions. They just keep repeating the "we aren't removing existing functionality in current versions" mantra).
Whilst being concerned about such things is healthy, i'd suggest reading up on how most password managers work. Anything not coded by muppets is encrypted via the passphrase that is never sent over the network.
So an attacker should be able to hack the remote site and steal your password database all they like. They don't have the unencrypted data.
The naive implementation of a password database - i.e., having you enter your passphrase which is then sent to the site to decrypt your password (Or even worse, to just log into the remote site to retrieve a clear text version of your password) and send back to you just isn't the way it is done by any security company with any sense.
The encryption used by a password manager can be much, much stronger than the encryption used by say, a website login. A website has to process many, many password checks per second. Your password manager can use enough rounds of encryption so that waiting a second or thereabouts for it to unlock your database (due to processing the encryption) is good enough. But such heavy encryption means that brute forcing it is very slow.
vs. brute forcing a stolen website password database (e.g., say macrumors gets hacked and their user passwords get downloaded)- which is often very quick to crack, because the encryption has to be FAST. two totally different scenarios. as web site password database can have millions or billions of attempts made on it per second with any modern GPU. a decent password manager database is millions (or more) times slower to break - because it was designed without the constraints of having to be FAST to respond to huge numbers of website hits.
don't get me wrong.
if you KNOW your password database has been stolen, you should change the passphrase on it (as a precaution, to be sure), and when you can, change the passwords contained in it.
but the encryption on your password database gives you a very long time to be safe until you can do that, unless the attacker also KNOWS your password database master passphrase. to crack a Keepass database via brute force for example would take a current PC something in the order of trillions of years at current processing speeds.
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