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While there is a general explanation why password hashing is not configured by default, there is no explanation why weak algorithms are offered at all. As a lot of the algorithms are not secure by modern standards, why even have those in the first place?
For the same reason hashing is not configured by default: The devicepasswords application is to integrate mostly legacy systems into a modern authentication environment, additionally using a high(er) entopic password than the average, so most attacks don't apply anyway.
devicepasswords/docs/how-to/password-hashing.md
Lines 3 to 12 in de8ed3c
| Passwords are usually stored encoded by a one way function, a hash function. | |
| Even if an attacker gets access to the database, | |
| they can only access the hash values and not use the password to login. | |
| Additionally, users often choose easy-to-guess password and reuse them across devices. | |
| On the other hand most of the attacks against passwords do not apply for device passwords: | |
| They are narrowly scoped and random-generated. | |
| Still password hashing is a good hardening measure. | |
| As the device passwords are unique and random, | |
| even hash functions inadequate for regular passwords may be found acceptable. |
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