There are two types of encryption supported by Nextcloud: server-side encryption and end-to-end encryption.
Server-side encryption protects primary storage on external services like S3 object storage. It does not protect against a compromised server hosting Nextcloud itself.
Prior to Nextcloud Hub 3, server-side encryption added some 35% to the file size. This is now reduced.
End-to-end encryption allows selected private folders to be encrypted, and protects against local comromise (TO BE COMFIRMED - perhaps done so through user key management). It is useful to encrypt password files and files storing private keys.
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