The server and its plugins will have stored all data using one UUID format, and changing whether Offline Mode is enabled will make it expect the other format, causing all existing user data to break. This UUID breakage is also an issue when turning Offline Mode on and off. For example, it might cause WorldGuard to fail to look up usernames for offline players. These modified UUIDs can cause problems in many plugins, especially those needing to look up user data. When using Offline Mode, the UUID that each Minecraft account is uniquely tied to is different. Authentication plugins can also be annoying to the user, leading to low-security passwords such as their username.
AUTHENTICATION SERVERS ARE DOWN MINECRAFT ON MY SERVER MODS
Some authentication plugins such as AuthMe on Bukkit servers can partially mitigate these vulnerabilities however, it's possible other plugins or mods on the server still provide elevated access or that a vulnerability is found within the authentication plugin. Anyone can join using those accounts and have elevated permissions. This vulnerability is even more of an issue on servers with players with OP privileges or permissions given via a permissions plugin. The most major is that it entirely disables authentication, meaning anyone can join with any username. Using offline mode comes with some significant security risks. Many people would switch to Offline Mode when that happened rather than be locked out from playing with their friends. In the earlier days of Minecraft, Offline Mode was also useful as the authentication servers would go down a lot. Common examples could be schools, workplaces, or some countries. This can be somewhere without an internet connection or a firewall that prevents access to the Minecraft authentication servers. The most obvious is to let players use a local server offline. Offline Mode does, however, come with security risks and less software support. This feature allows accessing the game while Mojang's servers are down, but it's also often used for piracy as it means the user does not need to log in with their Microsoft account. Offline Mode is a feature of Minecraft servers that allows disabling user authentication.