With certain hardware people can now dump switch cartridges and save them to an SD card in a way that allows them to be played via other hardware as though they were perfectly genuine games, online and all. However, each cartridge has a unique identifier that cannot be changed. That means that someone could buy a game, dump it so they can play it any time, and return/resell the cartridge. Someone with no knowledge of any of this could buy that game and go to play it online while the person who dumped the game is also playing it online. The concern is that when nintendo detects that two consoles are online playing a game with the same cartridge identifier, they assume that the console or the game has been hacked, and the switches and/or the accounts associated with them can be permanently banned from online. They have no way of telling who is playing the dumped version of the cartridge and who is playing the genuine version; only that the cartridge has been duplicated. This essentially means that anyone buying a used game is at risk of getting forever banned from online even if they did nothing wrong.
This could completely ruin the market for used switch games. It will be risky to buy used games and it will be much harder for people to sell them.
But right now we don't know how Nintendo will handle this. Maybe instead of bans they may just prevent any cartridges with an identifier that is known to have been duplicated from being playable at all (which would still be a bummer if you bought a game and then it didn't work, but it's still better than a permaban) We don't know yet and we may not know until the problem becomes more widespread.
