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My new favourite password manager
(keepass.info)
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this post was submitted on 13 Oct 2023
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In theory at least, online services would be more safe than a locally decrypted vault. If your computer is compromised, the bad actors can pull your encrypted vault for an unlimited brute force attack. Of course, this can be mitigated by increasing the decryption time. However, if your vault is already decrypted, then bad actors can just pull all your password from your memory.
I, for one, am decrypting my vault once when I start my PC. In theory, if I were to use an online solution, bad actors wouldn't be able to pull my vault from memory.
It's the same issue once you login to your vault via browser extension. They have to download your vault locally on login to decrypt it when you enter your password anyway*. Even if they don't store your vault password in memory, they either store the entire vault (unlikely for size reasons) or a more temporary key to access the vault. Local compromise is full compromise already.
*If they don't, then they either made a giant technological leap, or they're storing your passwords on a simple database on their servers and that's not what you want from a password manager.