Passwords are bearer credentials and as such, they are not a meaningful layer of defense when in the custody of even a modestly competent system administrator.
As I'd said, you need to look no further than annual threat reports to see that credential theft is the most common avenue of abuse - by a lot. Hardware assertions, on the other hand, which in WebAuthN standards are also bound to domain origins, simply remove this risk entirely. Let me repeat: you cannot phish a WebAuthN assertion. Yes, you can pull off a physical attack, but at this point of the game, it is over because the adversary could just implant a bootkit, keylogger or backdoor on your valuable system.
The threat landscape certainly changes but the economics of computer fraud and abuse remains largely the same: attack the most vulnerable link in the chain for maximum profit for the least amount of cost - the human and her portable password (and other forms of exportable factors, roughly in order of security: SMS-based, HOTP/TOTP apps, email magic links, Duo-style "confirmations").
As I'd said, you need to look no further than annual threat reports to see that credential theft is the most common avenue of abuse - by a lot. Hardware assertions, on the other hand, which in WebAuthN standards are also bound to domain origins, simply remove this risk entirely. Let me repeat: you cannot phish a WebAuthN assertion. Yes, you can pull off a physical attack, but at this point of the game, it is over because the adversary could just implant a bootkit, keylogger or backdoor on your valuable system.
The threat landscape certainly changes but the economics of computer fraud and abuse remains largely the same: attack the most vulnerable link in the chain for maximum profit for the least amount of cost - the human and her portable password (and other forms of exportable factors, roughly in order of security: SMS-based, HOTP/TOTP apps, email magic links, Duo-style "confirmations").