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The benefit for the user is that his data is fully protected in case of a server breach. Also, I would have no way to see his confidential data, so he does not have to trust me so much. (On the other hand, I would also have no way to help the user recover his salt if he loses it).
I don't recall seeing that approach used anywhere. Do you know of any reason ?
Is it because of a legal requirement to be able to assist government investigation, and thus be able to read user data saved on the server ??