As insecure as passwords generally are, they’re not going away anytime soon. Every year you have more and more passwords to deal with, and every year they get easier and easier to break. You need a strategy.
The best way to explain how to choose a good password is to explain how they’re broken. The general attack model is what’s known as an offline password-guessing attack. In this scenario, the attacker gets a file of encrypted passwords from somewhere people want to authenticate to. His goal is to turn that encrypted file into unencrypted passwords he can use to authenticate himself. He does this by guessing passwords, and then seeing if they’re correct. He can try guesses as fast as his computer will process them—and he can parallelize the attack—and gets immediate confirmation if he guesses correctly. Yes, there are ways to foil this attack, and that’s why we can still have four-digit PINs on ATM cards, but it’s the correct model for breaking passwords…
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