Nextcloud HUB II 24.02 encrypted external storage (not primary)

Have anyone been using NC 24.02 with encrypted external storage? The default text/mark down editor always open up the encrypted version of the file instead of the decrypted text. I thought something was wrong with my production installation so I set up a fresh new NC server, same issue.

On the same note, the Nextcloud Office does the same thing. pulls up encrypted files correctly. So are desktop/mobile clients sync.