[Thorrez]

Why does it require internet access? If you use a private key stored on your yubikey and a public key stored in your ssh configs, that shouldn't require internet access.

[mihaigalos]

Because there is a Yubico server involved in the auth process. No internet access means you cannot authenticate.

[Thorrez]

Why is there a Yubico server involved? Why can't it use public and private keys? What does the Yubico server do?

Hopefully this isn't using Yubico OTP, which is phishable:

https://developers.yubico.com/OTP/