diff --git a/src/bind_faction.c b/src/bind_faction.c
index 03a75281a..c6b747416 100644
--- a/src/bind_faction.c
+++ b/src/bind_faction.c
@@ -392,7 +392,7 @@ static int tolua_faction_set_password(lua_State * L)
 {
     faction *self = (faction *)tolua_tousertype(L, 1, 0);
     const char * passw = tolua_tostring(L, 2, 0);
-    faction_setpassword(self, password_hash(passw, 0, PASSWORD_DEFAULT));
+    faction_setpassword(self, password_encode(passw, PASSWORD_DEFAULT));
     return 0;
 }
 
diff --git a/src/kernel/faction.c b/src/kernel/faction.c
index 936c38df2..a8cf44998 100755
--- a/src/kernel/faction.c
+++ b/src/kernel/faction.c
@@ -252,7 +252,7 @@ faction *addfaction(const char *email, const char *password,
     }
 
     if (!password) password = itoa36(rng_int());
-    faction_setpassword(f, password_hash(password, 0, PASSWORD_DEFAULT));
+    faction_setpassword(f, password_encode(password, PASSWORD_DEFAULT));
     ADDMSG(&f->msgs, msg_message("changepasswd", "value", password));
 
     f->alliance_joindate = turn;
diff --git a/src/kernel/faction.test.c b/src/kernel/faction.test.c
index c5a1236b3..19b4da883 100644
--- a/src/kernel/faction.test.c
+++ b/src/kernel/faction.test.c
@@ -124,7 +124,7 @@ static void test_check_passwd(CuTest *tc) {
     faction *f;
     
     f = test_create_faction(0);
-    faction_setpassword(f, password_hash("password", 0, PASSWORD_DEFAULT));
+    faction_setpassword(f, password_encode("password", PASSWORD_DEFAULT));
     CuAssertTrue(tc, checkpasswd(f, "password"));
     CuAssertTrue(tc, !checkpasswd(f, "assword"));
     CuAssertTrue(tc, !checkpasswd(f, "PASSWORD"));
diff --git a/src/kernel/save.c b/src/kernel/save.c
index 3b7c13705..20188ea56 100644
--- a/src/kernel/save.c
+++ b/src/kernel/save.c
@@ -1239,7 +1239,7 @@ faction *readfaction(struct gamedata * data)
     }
 
     READ_STR(data->store, name, sizeof(name));
-    faction_setpassword(f, (data->version >= CRYPT_VERSION) ? name : password_hash(name, 0, PASSWORD_DEFAULT));
+    faction_setpassword(f, (data->version >= CRYPT_VERSION) ? name : password_encode(name, PASSWORD_DEFAULT));
     if (data->version < NOOVERRIDE_VERSION) {
         READ_STR(data->store, 0, 0);
     }
diff --git a/src/laws.c b/src/laws.c
index 22c0fa1a8..79889e7da 100755
--- a/src/laws.c
+++ b/src/laws.c
@@ -2173,7 +2173,7 @@ int password_cmd(unit * u, struct order *ord)
         cmistake(u, ord, 283, MSG_EVENT);
         strlcpy(pwbuf, itoa36(rng_int()), sizeof(pwbuf));
     }
-    faction_setpassword(u->faction, password_hash(pwbuf, 0, PASSWORD_DEFAULT));
+    faction_setpassword(u->faction, password_encode(pwbuf, PASSWORD_DEFAULT));
     ADDMSG(&u->faction->msgs, msg_message("changepasswd",
         "value", pwbuf));
     return 0;
diff --git a/src/util/password.c b/src/util/password.c
index 1b6a52cdf..b7880b8e6 100644
--- a/src/util/password.c
+++ b/src/util/password.c
@@ -91,10 +91,10 @@ static const char * password_hash_i(const char * passwd, const char *input, int
     return NULL;
 }
 
-const char * password_hash(const char * passwd, const char * salt, int algo) {
+const char * password_encode(const char * passwd, int algo) {
     static char result[64]; // TODO: static result buffers are bad mojo!
     if (algo < 0) algo = PASSWORD_DEFAULT;
-    return password_hash_i(passwd, salt, algo, result, sizeof(result));
+    return password_hash_i(passwd, 0, algo, result, sizeof(result));
 }
 
 int password_verify(const char * pwhash, const char * passwd) {
@@ -106,6 +106,9 @@ int password_verify(const char * pwhash, const char * passwd) {
     assert(pwhash);
     assert(pwhash[0] == '$');
     algo = pwhash[1];
+    if (!password_is_implemented(algo)) {
+        return VERIFY_UNKNOWN;
+    }
     if (algo == PASSWORD_BCRYPT) {
         char sample[200];
         _crypt_blowfish_rn(passwd, pwhash, sample, sizeof(sample));
@@ -115,9 +118,6 @@ int password_verify(const char * pwhash, const char * passwd) {
     assert(pos && pos[0] == '$');
     pos = strchr(pos, '$')+1;
     result = password_hash_i(passwd, pos, algo, hash, sizeof(hash));
-    if (!password_is_implemented(algo)) {
-        return VERIFY_UNKNOWN;
-    }
     if (strcmp(pwhash, result) == 0) {
         return VERIFY_OK;
     }
diff --git a/src/util/password.h b/src/util/password.h
index 0bdd9d4ff..ec7ab6bbc 100644
--- a/src/util/password.h
+++ b/src/util/password.h
@@ -12,4 +12,4 @@
 #define VERIFY_FAIL 1 // password is wrong
 #define VERIFY_UNKNOWN 2 // hashing algorithm not supported
 int password_verify(const char *hash, const char *passwd);
-const char * password_hash(const char *passwd, const char *salt, int algo);
+const char * password_encode(const char *passwd, int algo);
diff --git a/src/util/password.test.c b/src/util/password.test.c
index cb3838774..eb7bcbc69 100644
--- a/src/util/password.test.c
+++ b/src/util/password.test.c
@@ -9,25 +9,28 @@ static void test_passwords(CuTest *tc) {
 
     expect = "$apr1$FqQLkl8g$.icQqaDJpim4BVy.Ho5660";
     CuAssertIntEquals(tc, VERIFY_OK, password_verify(expect, "Hodor"));
-    hash = password_hash("Hodor", "FqQLkl8g", PASSWORD_APACHE_MD5);
+    hash = password_encode("Hodor", PASSWORD_APACHE_MD5);
     CuAssertPtrNotNull(tc, hash);
-    CuAssertStrEquals(tc, expect, hash);
+    CuAssertIntEquals(tc, 0, strncmp(hash, expect, 6));
 
     expect = "$1$ZouUn04i$yNnT1Oy8azJ5V.UM9ppP5/";
     CuAssertIntEquals(tc, VERIFY_OK, password_verify(expect, "jollygood"));
-    hash = password_hash("jollygood", "ZouUn04i", PASSWORD_MD5);
+    hash = password_encode("jollygood", PASSWORD_MD5);
     CuAssertPtrNotNull(tc, hash);
-    CuAssertStrEquals(tc, expect, hash);
+    CuAssertIntEquals(tc, 0, strncmp(hash, expect, 3));
 
     expect = "$0$password";
     CuAssertIntEquals(tc, VERIFY_OK, password_verify(expect, "password"));
     CuAssertIntEquals(tc, VERIFY_FAIL, password_verify(expect, "arseword"));
-    hash = password_hash("password", "hodor", PASSWORD_PLAIN);
+    hash = password_encode("password", PASSWORD_PLAIN);
     CuAssertPtrNotNull(tc, hash);
     CuAssertStrEquals(tc, expect, hash);
 
     expect = "$2y$05$RJ8qAhu.foXyJLdc2eHTLOaK4MDYn3/v4HtOVCq0Plv2yxcrEB7Wm";
     CuAssertIntEquals(tc, VERIFY_OK, password_verify(expect, "Hodor"));
+    hash = password_encode("Hodor", PASSWORD_BCRYPT);
+    CuAssertPtrNotNull(tc, hash);
+    CuAssertIntEquals(tc, 0, strncmp(hash, expect, 7));
 }
 
 CuSuite *get_password_suite(void) {