Problem: Your external Apple Magic Keyboard plugged into your Apple Macbook Pro M1 is not registering the keystrokes on the login screen.
How To Fix:
Step 1: Manually open the lid of the MBP (annoying because its probably under a huge pile of papers and cables on your desk, like mine was)...
Step 2: Manually type in your password with the built-in MBP keyboard to login (because Touch ID most likely expired again for some arbitrary reason)...
Step 3: Click "Allow" on the Year-1999-McAffee-AntiVirus-Software-esque message (see image) because it's literally hardwired a keyboard that the same company, Apple, designed, manufactured and shipped to you.
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Apple: Nobody wants this. You don't even trust a hardwired Apple-made keyboard? Store a signed key in Secure Enclave on keyboard and verify it with MBP on wired connection.
Bad UX, very not Apple.