You’re trying to use nice words within your assumption, but one can only assume that yes, this is to minimize hackers. Whether this is a good service, does not belong to that assumption. This service is demolished by the constant need to protect every single aspect against hackers. It’s on par with kernel anticheats. A few cheaters ruin it for the rest of us.
The main priority should be family sharing, which is literally what it’s called. It’s not my job to provide a good service. But I do know when a service is prone to bullshit that’ll just punish people for actually trying to be nice and share stuff within their family.
Valve could have just banned the account that was actually cheating, send a mail to the owner, and let them disable the sharing. Punish after.