I'm building a web app making JSON-RPC calls to the bitcoind server. I have security concerns on how to protect the wallet.dat file.
I'm encrypting the directory where wallet.dat will be. Should I also use the bitcoind encryptwallet command? When using Bitcoin client wallets like Electrum every time I send BTC it asks me for my password. Building a web app where users will have their own account (and addresses) should a bitcoind password be used? Does bitcoind store the private keys for every public address generated?