The first passwords were created in the 1960s for MIT's Compatible Time-Sharing System. These passwords were first used by students in the program who were required to access the system as individual entities.
Each student user created a password; however, the program’s leaders soon learned that this method of storage did not work once they discovered that one user who wanted more time on the computer simply printed out the passwords from the machine and logged in as a different user than him or herself.
This was a problem because each user was only granted so much time on the computer per week under their identity. Program leaders quickly found that this manner of storing passwords was not practical for protecting information or keeping others from accessing other student’s profiles. A more secure method was needed, they theorized, even on the first computer ever used. This also was likely the first recorded data breach anywhere in the world.