I'd agree with the sibling comments that physical keys are probably still the best option, along maybe with the realisation that without some sort of trust root

I'd agree with the sibling comments that physical keys are probably still the best option, along maybe with the realisation that without some sort of trust root based on human contact, things don't work. Case in point: we actually have an extremely widely used 2factor system which appears to be working reasonably well for several decades now, despite constant attacks and strong incentives to crack it: Debit cards, PINs and ATMs. Even with the constant threat of skimmers, there hasn't been any mass events of emptied bank accounts so far. Why does it work? My hunch is that two factors play a role: 1) it's based on a physical token, so any attack is necessarily local and needs "people on the ground". 2) there is actually a robust system for recovery and revocation in the shape of bank branches that you can visit, which involve human staff who can apply common sense judgement. Those make the event of a lost card into a nuisance rather than catastrophe. And maybe the second lesson we can learn from the breach: Entrusting the entire collection of passwords of your digital life to a single 3rd party and then allowing that party to upload the passwords to the cloud, in plaintext, does not just superficially appear to be a bad idea that is actually genius because of crypto magic, it is, in fact, a really bad idea.