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Adding on (because I almost did this very, very stupid thing until I stopped and thought for a moment):
If you create accounts on multiple instances with the same username, don't use the same password. Otherwise anyone with access to one has access to all.
Passwords aren't encrypted? Or you mean if an instance's password leaks, they all leak? Because that applies to everything. Use unique passwords with every account, everywhere.
The advice to always use a unique password per site is an excellent one.
The why is multifaceted, and some of them are moderately complex.
First off, not every site is going to be storing your password in a good a secure manner.
In an ideal world, every site on the planet would be hashing it with something like bcrypt with a fairly aggressive cost setting, and good salts.
And they would have a way to automatically rehash your password on login in the event that the password hashing settings change. (Almost everyone misses this one.)
In practice... It could be stored in plain text. It could be hashed with classic crypt(), or with md5 or sha1 with no salt. There are so many ways to get it wrong.
On the rehashing one, they could have picked something that was best practices at the time, you setup your account, and then two years later, best practices have changed, it turns out that there was a way to attack the previous way, so they change how they do it... And that's great for everyone who changes their password or sets up a new account after that change, but everyone who did it before that change? Well, those passwords are just sitting there hashed by the old method indefinitely.
Or someone could compromise the site, and grab every password everyone enters.
Or you could fall prey to a phishing attack, and type your login to what looks exactly like the site in question, but is infact a common typo of the real domain.
Again, there are a lot of ways for the password used on a site to get compromised. Many of those ways are entirely out of your control. It is standard practice for attackers to attempt to use that password and username / email on other services when this happens, just so that they can see what else they can get into.
Don't let that work.
I don’t have enough desire to check, but I’d assume they are encrypted AND salted so it’s not as easy as the top comment makes out.
If an instance was hacked, the hackers would get a hash and a salt. They’d still have to figure out what plaintext password + salt = hash.
This is the way.
For real! In any case people should always be using unique passwords for any account on any service, but yeah this is definitely understated.