Passwords are knowledge factors that users must remember and repeat, while passkeys are public key credentials stored locally on a user device. The private key stays on the device and is unlocked by a biometric, PIN, or similar gesture. The service stores only the public key, which reduces phishing exposure and avoids password reuse.
How passkeys are stored differently from passwords
Passwords are stored as shared secrets: the user knows them, types them, and the service verifies a submitted value against its stored representation. Passkeys are asymmetric credentials, so the device keeps the private key locally and the service keeps only the public key. That design means the service never needs to hold a reusable secret that could be phished, replayed, or exposed in a password database breach.
The storage model matters because it changes the attack surface. With passwords, compromise of the server-side credential store can expose material that is directly useful for login attempts elsewhere, especially if users reuse the same password. With passkeys, exposure of the service-side public key does not help an attacker authenticate, because the private key never leaves the user device in normal operation.
How passkeys and passwords are used at login time
Passwords are presented directly to the service, usually over the network, and the same secret can be reused across many sites unless a user manages it carefully. Passkeys work through a challenge-response exchange: the service sends a challenge, and the device signs it with the private key after the user unlocks that key with a biometric, PIN, or similar local gesture. The credential is thus bound to the device and to the origin being accessed.
That usage difference is what makes passkeys more resistant to phishing. A user can be tricked into entering a password on a fake site, but the passkey flow is designed so the private key signs for the real service origin rather than handing over something reusable. In practice, that reduces credential theft, replay, and the common downstream failures caused by password reuse.
What this means for credential risk and recovery
Passkeys remove the service-side storage of a reusable secret, but they do not remove all identity risk. If a device is lost, the user account recovery path, device enrollment process, and backup strategy become part of the control surface. Passwords shift more risk to human memorisation and reuse; passkeys shift more responsibility to device security, recovery design, and managing trusted authenticators.
That is why passkeys are best understood as a stronger authentication mechanism, not just a nicer password replacement. They reduce exposure from phishing and database theft, but they also introduce dependency on local device protection and on how the organisation handles re-enrollment, step-up checks, and account recovery when a key is unavailable.
Risk and Threat Considerations
Passwords remain attractive to attackers because they are portable, reusable, and often exposed through phishing, credential stuffing, or database compromise. Passkeys materially reduce those failure modes by removing the shared secret from the service side, but the main residual risk moves to device compromise, recovery abuse, and unsafe enrollment or reset workflows.
Failure mechanism: An attacker can still succeed if they compromise the unlocked device, trick the user through a malicious recovery path, or exploit weak registration and account recovery controls that let a new authenticator be added without sufficient verification.
Impact: The organisation gets much stronger phishing resistance than with passwords, but a weak recovery process can reintroduce account takeover risk through the back door, especially for high-value users and support-assisted resets.
Standards & Framework Alignment
This section maps relevant standards and security frameworks to the operational risks and controls described in this guidance.
OWASP Non-Human Identity Top 10 and OWASP API Security Top 10 address the attack and risk surface, while NIST SP 800-63 sets the governance and control requirements practitioners need to meet.
| Framework | Control / Reference | Relevance |
|---|---|---|
| NIST SP 800-63 | Digital Identity Guidelines | Covers phishing-resistant authentication and public-key authenticators used by passkeys. |
| Recommendation — Adopt phishing-resistant authenticators and align sign-in flows with the digital identity guidance. | ||
| OWASP Non-Human Identity Top 10 | NHI-02 — Secret Leakage | Passkeys remove server-held reusable secrets, which directly reduces secret exposure risk. |
| NHI-07 — Long-Lived Secrets | Passwords are long-lived shared secrets; passkeys reduce dependence on them for login. | |
| NHI-04 — Insecure Authentication | The comparison turns on how passkeys authenticate without sending a reusable secret. | |
| Recommendation — Eliminate reusable secrets from server-side storage wherever a public-key alternative exists. Replace long-lived shared login secrets with device-bound credentials and short-lived verification steps. Use phishing-resistant authentication flows that never disclose the private credential to the service. | ||
| OWASP API Security Top 10 | API2 — Broken Authentication | Authentication design is central to the password versus passkey comparison for login security. |
| Recommendation — Prefer authentication methods that resist replay, phishing and credential reuse. | ||
Practitioner Guidance
What to verify: Treat the service-side absence of a password as only one part of the control. Verify that passkey enrollment, device loss handling, and help desk recovery require stronger checks than a normal password reset, because those are the points attackers will target once password guessing and phishing become less effective.
Decision rule: If the user population includes high-risk roles or sensitive applications, prefer passkeys as the default sign-in method and keep passwords only as an exception path with explicit recovery controls. If a system still relies on passwords for primary access, assume phishing and reuse remain material risks.
Practitioner takeaway: The key difference is not just where the secret lives, it is whether the service ever receives a reusable secret at all. That shift sharply improves authentication security, but only if recovery and device enrollment are controlled as carefully as the login itself.
Related resources from NHI Mgmt Group
- What is the difference between passkeys stored in a password manager and passwords stored in the same vault?
- What is the difference between stored credentials and OAuth-based MCP access?
- What is the difference between short-lived temporary passwords and long-term hardware credentials?
- What is the difference between passkeys and one-time passwords for secure sign-in?
Deepen Your Knowledge
Reviewed and updated by the NHIMG editorial team on September 29, 2026.
NHI Mgmt Group — the #1 independent authority on Non-Human Identity, IAM, and Agentic AI security. nhimg.org
