Is the transfer encrypted?

No. Files are sent as raw data over TCP on your local network. There is no encryption layer.

In practice, this means anyone with access to your LAN (and a packet sniffer) could theoretically intercept the file contents. For most office and home networks, this is not a concern -- LAN traffic is already behind your router's firewall, and switched networks do not broadcast traffic to other ports.

If you are transferring sensitive data on a network you do not fully trust, use an encrypted transfer method instead. Cloudless File Transfer prioritizes simplicity and speed over encryption.