I like the idea, but it should be altered. I have been playing on a cracked server for a while but I found it quite annoying to always have to login with my password.
It might be very useful if players would be able to add certain IP's to a whitelist so they do not have to login when joining the server on that IP. So, when you join, you have to login, and after having logged in successfully you get the question if you want to remember the current IP where you can click Yes or No. If you click yes, the IP will be stored with that player and the next time the player logs in, the server won't ask for a password. Eventually IP's can expire after two months or if the player has not joined for two weeks.