EncFS provides an encrypted filesystem in user-space. It runs without any 
special permissions and uses the FUSE library and Linux kernel module to 
provide the filesystem interface. You can find links to source and binary 
releases below.

As with most encrypted filesystems, Encfs is meant to provide security against 
off-line attacks; ie your notebook is stolen, your backups are stolen, etc. The 
way Encfs works is different from the “loopback” encrypted filesystem support 
built into the Linux kernel because it works on files at a time, not an entire 
block device. This is a big advantage in some ways, but does not come without a 
cost.

http://arg0.net/users/vgough/encfs.html

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