Get started with encrypted files in Drive, Docs, Sheets … – Google Help

All files uploaded to Drive or created in Docs, Sheets, and Slides are encrypted in transit and at rest with AES256 bit encryption. For additional confidentiality, your organization can allow you to encrypt Drive, Docs, Sheets, and Slides files with Workspace Client-side encryption. Encrypted files have some limitations from standard files.

https://support.google.com/drive/answer/10519333?hl=en&co=GENIE.Platform%3DDesktop