Public bug reported:

Binary package hint: qemu

1) Ubuntu 8.04,
CPU Intel DualCore.
Linux athlon 2.6.24-19-generic #1 SMP Wed Jun 18 14:15:37 UTC 2008 x86_64 
GNU/Linux

2) qemu-0.9-1ubuntu1

3) "qemu-img create -e -f qcow encrypted_qcow.img" should ask for a
password and create an encrypted disk image.

4) Despite asking for a password,  it just prints: "Formatting
'encrypted_qcow.img', fmt=qcow, encrypted, size=2097152 kB".

Then, when trying to start qemu:
$ qemu -m 512 -cdrom ubuntu-8.04.1-desktop-amd64.iso -hda encrypted_qcow.img 
-boot d

nothing happens (no new window opens, qemu is probably running since the
command prompt does not return, however it does not show any CPU
activity. CTRL+C interrupts it, no error is printed.

Similarly, when using "qemu-img convert -e existing_image.qcow2 -O qcow2
encrypted_image.qcow2" (existing_image.qcow2 is a working installation
of openSuse), qemu-img asks for a password and creates a copy of the
image. When trying to load the new encrypted image with Qemu, nothing
happens.

** Affects: qemu (Ubuntu)
     Importance: Undecided
         Status: New

-- 
qemu-img does not create encrypted disk
https://bugs.launchpad.net/bugs/249540
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