The global configuration file stores the various passwords that are needed in order to interface with your organizations systems and external repositories. For example, the system may need your LDAP server password.
In order to keep these passwords secure, you can choose to store them in an encrypted format. In this case, Artifactory will generate an Encryption Key which will be used to encrypt these passwords for storage and display, and to decrypt them when you need to access the corresponding resources.
IBM JDK Encryption Restrictions
Users of the IBM JDK should read about IBM JDK encryption restrictions described in Centrally Secure Passwords.