diff --git a/appinfo/info.xml b/appinfo/info.xml
index 70ab3584..09b4607f 100644
--- a/appinfo/info.xml
+++ b/appinfo/info.xml
@@ -43,7 +43,7 @@ to join us in shaping a more versatile, stable, and secure app landscape.
 *Your insights, suggestions, and contributions are invaluable to us.*
 
 	]]></description>
-	<version>3.2.1</version>
+	<version>3.2.3</version>
 	<licence>agpl</licence>
 	<author mail="andrey18106x@gmail.com" homepage="https://github.com/andrey18106">Andrey Borysenko</author>
 	<author mail="bigcat88@icloud.com" homepage="https://github.com/bigcat88">Alexander Piskun</author>
diff --git a/lib/Controller/DaemonConfigController.php b/lib/Controller/DaemonConfigController.php
index e8624c9c..433a756e 100644
--- a/lib/Controller/DaemonConfigController.php
+++ b/lib/Controller/DaemonConfigController.php
@@ -19,6 +19,7 @@
 use OCP\IConfig;
 use OCP\IL10N;
 use OCP\IRequest;
+use OCP\Security\ICrypto;
 
 /**
  * DaemonConfig actions (for UI)
@@ -33,6 +34,7 @@ public function __construct(
 		private readonly AppAPIService       $service,
 		private readonly ExAppService        $exAppService,
 		private readonly IL10N               $l10n,
+		private readonly ICrypto			 $crypto,
 	) {
 		parent::__construct(Application::APP_ID, $request);
 	}
@@ -66,6 +68,9 @@ public function updateDaemonConfig(string $name, array $daemonConfigParams): Res
 		// Restore the original password if "dummySecret123" is provided
 		if ($haproxyPassword === 'dummySecret123') {
 			$daemonConfigParams['deploy_config']['haproxy_password'] = $daemonConfig->getDeployConfig()['haproxy_password'] ?? "";
+		} elseif (!empty($haproxyPassword)) {
+			// New password provided, encrypt it
+			$daemonConfigParams['deploy_config']['haproxy_password'] = $this->crypto->encrypt($haproxyPassword);
 		}
 
 		// Create and update DaemonConfig instance
@@ -129,16 +134,22 @@ public function checkDaemonConnection(array $daemonParams): Response {
 		$haproxyPassword = $daemonParams['deploy_config']['haproxy_password'] ?? null;
 
 		if ($haproxyPassword === 'dummySecret123') {
-			// If the secret is "dummySecret123" we check if such record is present in DB
+			// For cases when the password itself is 'dummySecret123'
+			$daemonParams['deploy_config']['haproxy_password'] = $this->crypto->encrypt($haproxyPassword);
+
+			// Check if such record is present in the DB
 			$daemonConfig = $this->daemonConfigService->getDaemonConfigByName($daemonParams['name']);
 			if ($daemonConfig !== null) {
+				// such Daemon config already present in the DB
 				$haproxyPasswordDB = $daemonConfig->getDeployConfig()['haproxy_password'] ?? "";
 				if ($haproxyPasswordDB) {
-					// if there is a record in the DB and there is a password,
-					// then we request it from the DB instead of the “masked” one
+					// get password from the DB instead of the “masked” one
 					$daemonParams['deploy_config']['haproxy_password'] = $haproxyPasswordDB;
 				}
 			}
+		} elseif (!empty($haproxyPassword)) {
+			// New password provided, encrypt it, as "initGuzzleClient" expects to receive encrypted password
+			$daemonParams['deploy_config']['haproxy_password'] = $this->crypto->encrypt($haproxyPassword);
 		}
 
 		$daemonConfig = new DaemonConfig([
diff --git a/lib/DeployActions/DockerActions.php b/lib/DeployActions/DockerActions.php
index a1f33082..91c88e87 100644
--- a/lib/DeployActions/DockerActions.php
+++ b/lib/DeployActions/DockerActions.php
@@ -18,6 +18,7 @@
 use OCP\ICertificateManager;
 use OCP\IConfig;
 use OCP\IURLGenerator;
+use OCP\Security\ICrypto;
 use Psr\Log\LoggerInterface;
 
 class DockerActions implements IDeployActions {
@@ -36,6 +37,7 @@ public function __construct(
 		private readonly IURLGenerator       $urlGenerator,
 		private readonly AppAPICommonService $service,
 		private readonly ExAppService		 $exAppService,
+		private readonly ICrypto			 $crypto,
 	) {
 	}
 
@@ -556,7 +558,8 @@ public function resolveExAppUrl(
 		}
 		if ($protocol == 'https' && isset($deployConfig['haproxy_password']) && $deployConfig['haproxy_password'] !== '') {
 			// we only set haproxy auth for remote installations, when all requests come through HaProxy.
-			$auth = [self::APP_API_HAPROXY_USER, $deployConfig['haproxy_password']];
+			$haproxyPass = $this->crypto->decrypt($deployConfig['haproxy_password']);
+			$auth = [self::APP_API_HAPROXY_USER, $haproxyPass];
 		}
 		return sprintf('%s://%s:%s', $protocol, $exAppHost, $port);
 	}
@@ -620,7 +623,8 @@ public function initGuzzleClient(DaemonConfig $daemonConfig): void {
 			$guzzleParams = $this->setupCerts($guzzleParams);
 		}
 		if (isset($daemonConfig->getDeployConfig()['haproxy_password']) && $daemonConfig->getDeployConfig()['haproxy_password'] !== '') {
-			$guzzleParams['auth'] = [self::APP_API_HAPROXY_USER, $daemonConfig->getDeployConfig()['haproxy_password']];
+			$haproxyPass = $this->crypto->decrypt($daemonConfig->getDeployConfig()['haproxy_password']);
+			$guzzleParams['auth'] = [self::APP_API_HAPROXY_USER, $haproxyPass];
 		}
 		$this->guzzleClient = new Client($guzzleParams);
 	}
diff --git a/lib/Migration/Version5000Date20241120135411.php b/lib/Migration/Version5000Date20241120135411.php
new file mode 100644
index 00000000..820a4e65
--- /dev/null
+++ b/lib/Migration/Version5000Date20241120135411.php
@@ -0,0 +1,59 @@
+<?php
+/**
+ * SPDX-FileCopyrightText: 2024 Nextcloud GmbH and Nextcloud contributors
+ * SPDX-License-Identifier: AGPL-3.0-or-later
+ */
+
+declare(strict_types=1);
+
+namespace OCA\AppAPI\Migration;
+
+use Closure;
+use OCP\DB\ISchemaWrapper;
+use OCP\IDBConnection;
+use OCP\Migration\IOutput;
+use OCP\Migration\SimpleMigrationStep;
+use OCP\Security\ICrypto;
+
+class Version5000Date20241120135411 extends SimpleMigrationStep {
+
+	public function __construct(
+		private IDBConnection $connection,
+		private ICrypto $crypto,
+	) {
+	}
+
+	/**
+	 * @param IOutput $output
+	 * @param Closure $schemaClosure The `\Closure` returns a `ISchemaWrapper`
+	 * @param array $options
+	 *
+	 * @return null|ISchemaWrapper
+	 */
+	public function postSchemaChange(IOutput $output, Closure $schemaClosure, array $options) {
+		// encrypt "haproxy_password" in the "ex_apps_daemons" table
+		$qbSelect = $this->connection->getQueryBuilder();
+		$qbSelect->select(['id', 'deploy_config'])
+			->from('ex_apps_daemons')
+			->where(1);
+		$req = $qbSelect->executeQuery();
+
+		while ($row = $req->fetch()) {
+			$deployConfig = $row['deploy_config'];
+			$deployConfig = json_decode($deployConfig, true);
+			if (!empty($deployConfig['haproxy_password'])) {
+				$deployConfig['haproxy_password'] = $this->crypto->encrypt($deployConfig['haproxy_password']);
+				$encodedDeployConfig = json_encode($deployConfig);
+				$qbUpdate = $this->connection->getQueryBuilder();
+				$qbUpdate->update('ex_apps_daemons')
+					->set('deploy_config', $qbUpdate->createNamedParameter($encodedDeployConfig))
+					->where(
+						$qbUpdate->expr()->eq('id', $qbUpdate->createNamedParameter($row['id']))
+					);
+				$qbUpdate->executeStatement();
+			}
+		}
+		$req->closeCursor();
+		return null;
+	}
+}
diff --git a/lib/Service/DaemonConfigService.php b/lib/Service/DaemonConfigService.php
index d7938142..0938771a 100644
--- a/lib/Service/DaemonConfigService.php
+++ b/lib/Service/DaemonConfigService.php
@@ -10,6 +10,7 @@
 use OCP\AppFramework\Db\DoesNotExistException;
 use OCP\AppFramework\Db\MultipleObjectsReturnedException;
 use OCP\DB\Exception;
+use OCP\Security\ICrypto;
 use Psr\Log\LoggerInterface;
 
 /**
@@ -20,6 +21,7 @@ public function __construct(
 		private readonly LoggerInterface    $logger,
 		private readonly DaemonConfigMapper $mapper,
 		private readonly ExAppService       $exAppService,
+		private readonly ICrypto			$crypto,
 	) {
 	}
 
@@ -38,6 +40,9 @@ public function registerDaemonConfig(array $params): ?DaemonConfig {
 		}
 		$params['deploy_config']['nextcloud_url'] = rtrim($params['deploy_config']['nextcloud_url'], '/');
 		try {
+			if (isset($params['deploy_config']['haproxy_password']) && $params['deploy_config']['haproxy_password'] !== '') {
+				$params['deploy_config']['haproxy_password'] = $this->crypto->encrypt($params['deploy_config']['haproxy_password']);
+			}
 			return $this->mapper->insert(new DaemonConfig([
 				'name' => $params['name'],
 				'display_name' => $params['display_name'],