Had to search for the answer elsewhere and then answer my own question. If anyone is curious how it works, check out this other topic I created before:
Took time but I found and answer and tested it. So I gotta, again, answer myself for people that stumble upon this.
For backups using StorJ it makes sense to use TrueCloud, because its integrated solution. It uses restic to backup the data as snapshots. The Cloud Sync is more like rsync of the data.
Yes, if encryption is not on, it will get encrypted only after upload on the StorJ side. On the other hand, as said above, TrueCloud uses restic, therefore, it encrypts the data on the trueNAS side…