You act as if everyone would be able to hack data stored locally. Hackers are rare, but this error of losing your character is very frequent. If storing it locally wont fix it something more drastic needs to be done. In a game where your character is everything, losing it seems like a basic massive error on the devs part. Even if it is server side, something needs to be done ASAP before new towns, weapons, items, etc! From what it sounds like from this dev here to me is that this issue will happen for the forseeable future if server admins are not properly setting a server up, and that is not acceptable. Get your priorites in line and fix the glaring massive issues before adding new content!