Wow, I did not realize that SSH did that. Good to know, and it makes sense as a default, because the people who need it need to have it on by default. But I think I'm going to be turning that off, because it's a security measure that doesn't make sense for my particular environment: 1) I'm pretty much never typing secrets into an SSH tunnel; these days if there's a secret I need to transmit over SSH I'm going to be c…
One common secret that goes through a tty ssh connection is a sudo password. You are probably typing sudo command so without obfuscation the attacker can find out the sudo keystrokes, the command keystrokes and then the encrypted bytes of the password. They don't have the timing data to decode them as easily as the previous parts but if they record enough traffic they might be able to decrypt the password. But maybe they won't, because the ssh session key is probably different each time. Furthermore I don't know how many times they should capture your encrypted password to be able to decrypt it. Maybe it's unfeasible.
Anyway, in case of the sudo password, if the attacker gets it what would happen? The attacker is hopefully not able to get a shell into the server. If they do they have different ways to get root privileges.
By the way, I also copy and paste secrets from either the password manager or the clipboard, because nobody remembers long random strings. The only exceptions are the passwords of a few accounts.