If a client needs to authenticate into a server successfully, the client needs to prove their identity. This is done by using a username and password. The client needs to present its username and password to the authentication server, and it will verify the identity. There are legacy protocols and systems that send this information in cleartext, even in an open network. Telnet is a good example of this. If someone is listening to traffic (packet capturing) on a Telnet session, they can easily capture a password as it is transmitted in cleartext.
Modern authentication protocols are well aware of these types of threats and use different technologies to encrypt credentials or create cryptographic hashes for identity verification. The cryptographic hash means a password string is transformed into a fixed-length digest using an algorithm.
Earlier in AD authentication...
