Hi @Salesforce Identity :

1. Are 'Identity Verification Credits Add-On License' used only for Passwordless login using SMS

OR  it can be used as 2nd factor of authentication along with password. 

2. Are 'Identity Verification credits" used for

   a). 2nd factor of authetication during registration process

    or

    b) Device activation

     or

   c). For every login?

Thanks