The boast by LastPass that its browser login tool "is the last password you'll ever need" has turned hollow with the news that its entire customer base will have to reset their master password after the company detected a possible attack on its database.

The company said it had noticed a “network traffic anomaly” on 3 May which corresponded to an unusual the movement of data from one of its databases and had decided to “assume the worst” and inform LastPass users of the danger.

“We know roughly the amount of data transferred and that it's big enough to have transferred people's email addresses, the server salt and their salted password hashes from the database,” the company said in a blog. “We also know that the amount of data taken isn't remotely enough to have pulled many users.”

Because the password database is encrypted, hackers would need to launch a dictionary attack on the stolen data in order to make it usable, which would put users logging in with shorter or easily-guessed passwords at high risk. Anyone using a longer, complex password would be safe.

“Unfortunately not everyone picks a master password that's immune to brute forcing,” the company said.

To avoid the possibility of impersonation, the company will only allow the master password to be reset after first verifying the email address and noting whether users access the service from known IP addresses.

By its nature – LastPass is a browser-accessed password database for multiple websites – the service’s users are hugely vulnerable should a compromise of the service occur. A hacker cracking a LastPass password could use it to log in to dozens of third-party websites.

Against that has to be set the huge insecurity of logging into multiple websites separately, possibly using the same insecure passwords. LastPass includes tools to automatically generate secure passwords and even analyse and rank the security of the ones already in use. The tool is highly regarded by its users.

LastPass said it now planned to speed a planned migration to the more database encryption scheme, PBKDF2, a key-stretching mechanism designed to protect against dictionary hacking of stolen passwords.