Not quite the same thing but it's quite common for hotels (in Europe in particular) to make a copy of your passport, for auto dealerships (at least in the US) to make a copy of your driver's license for a test drive, and many many other situations. I'm sure I'm forgetting lots of other cases. (And Twitter requires for verified accounts.)
It's usually an identify theft thing, because if I have all the information on your state ID I can make a copy that would be good enough for ... getting access to your instagram account I guess.
It's pretty hard to fake an ID in physical form, but one good enough for a webcam photo shouldn't be too hard.
The new US passport is pretty crazy. The photo page appears to be one giant NFC chip. The picture is barely visible. I suspect that it is meant to be inserted into some kind of reader machine, that will display a high-resolution version to the Customs agent.
This is exactly what happens, you lay your passport on a scanner thing machine, and the guard never looks at the title page, just stamps the visa, etc.
Or if you have an older passport, you lay it on the scanner machine five or six times, then an assistant comes and tries it on four or five of the machines, then gives up and hands you and the passport to the guard.