(Hope you don't mind me jumping in here.)   Perhaps the quickest solution is 
just to make the the {db}-ds.xml file read-only for the JBoss account and not 
accessible for anyone else.   (This should be common practice for any file 
containing passwords, regardless of the application.)  Further, JBoss should be 
running using it's very own (locked) account.

The trouble I see with going to all the effort of encrypting a password in the 
{db}-ds.xml file and then decrypting it elsewhere, is that now you've 
transferred the problem to how you control that encryption key.   You'll likely 
be needing to use symmetric encryption with a shared key - assuming you need to 
recover the cleartext password for the driver.  So now that encryption key 
needs to be stored somewhere... Hardcoding the key is a bad practice for 
several reasons.    Maybe there's a way to use PKE here....but I have to ask:  
does the driver send the password across the wire in cleartext to the database?

r,
Lance

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