Passwords are largely stored in servers with enough storage to deal with the users of them. However, distributing a PSK to every device is not friendly. 10 Mil

Passwords are largely stored in servers with enough storage to deal with the users of them. However, distributing a PSK to every device is not friendly. 10 Million Passwords will at minimum take about 80 MB, some phones and IoT devices have only ten times of that as permanent storage or less. Passwords work mostly because the other side has the storage and cpu capacity to operate with them