Upon further inspection this is really two separate problems:
1) The virtualbox DKMS module doesn't build on 7.0.0-31 or -34, and 
2) The failed dkms build produces a half-configured kernel that grub picks up 
and adds to the boot list despite it not having an initramfs. Without the 
initramfs LUKS systems can't decrypt the root filesystem. More info here: 
https://bugs.launchpad.net/ubuntu/+source/systemd/+bug/2141741

Since 2) is already being discussed in another bug we'll focus on 1)
here.

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https://bugs.launchpad.net/bugs/2169116

Title:
  Kernel Panic VFS: Unable to mount root fs on unknown-block(0,0) with
  LUKS encrypted SSD on kernel 7.0.0-x / 6.8.0-x

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