Oonchain password value can be read even if private.
Any value stored on the blockchain can be read, even if declared as private.
Password value can be read by anyone.
For example with a JS script:
await web3.eth.getStorageAt(contractAddress, 1 /storageSlotNumber/);
Store only a hash, or an encrypted value.
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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