The smart contract has a private variable called password but no data on the blockchain is private because it can be retrieved using the slots. Below is a simple POC which uses a foundry cheat code to retrieve the password from the smart contract.
The password is not protected and can be retrieved by anyone and can be used against owner.
Use off chain for private data or use hash functions to hash the password so no one can reverse engineer it.
Private functions and state variables are only visible for the contract they are defined in and not in derived contracts. In this case private doesn't mean secret/confidential
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