You're reading these events in reverse. At first, it wasn't nearly as bad like you're pointing out - then they found out they can de-obfuscate it. All in a day's work, so we're back to being able to have a database just "fine".Went down the rabbit hole on the Bluesky thread.
A salted hash would have been the better solution, but it's not as dire as previously thought:
Post from NoteNite: https://bsky.app/profile/notnite.com/post/3ll7cx45las26
The "fix" is that because the obfuscated names are unique on a per client level, there is no longer a universal database of characters and alts.
It's still hella broken (it should be a salted hash, not just obfuscated, so that you need a session secured token to decrypt the client IDs on the client side) and it won't stop a determined stalker from IDing all your alts, but the shared database is now useless (or as NotNite points out, lets SE know that it was you who tried to do it, so they can get after you for violating ToS.)
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