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Why does PostgreSQL use md5 hashing when authenticating a user against a DB?
https://wiki.postgresql.org/wiki/Client_Authentication
A typical recommended setup for network access to the database takes the local LAN address and only allows clients who authenticate using a secure MD5 password.
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If your password transfer between the application and the DBMS can be intercepted, then you already have a problem and much more serious than the fact that the password can theoretically be guessed. (rainbow tables don't help much, because md5 is far from just a password)
If the traffic between the application and the database goes in the wild outside world, then you need the ssl* settings in postgresql.conf. Full TLSv1.2 buns are included and the password can be transmitted even with plaintext.
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