During a call with one of my clients the question came out about encryption of data at rest for Data Factory and Databricks. The good news is that yep, the data is encrypted at rest.
Here are some references. . .
Data Factory Security: https://docs.microsoft.com/en-us/azure/data-factory/data-movement-security-considerations
Azure Data Factory does not store any data except for linked service credentials for cloud data stores, which are encrypted by using certificates.
Databricks uses Azure Data Lake Storage, which is encrypted at rest: https://docs.microsoft.com/en-us/azure/storage/common/storage-service-encryption
Azure Data Lake Storage: https://docs.microsoft.com/en-us/azure/storage/blobs/data-lake-storage-introduction
Azure Data Lake Storage Gen2 is a set of capabilities dedicated to big data analytics, built on Azure Blob storage. Data Lake Storage Gen2 is the result of converging the capabilities of our two existing storage services, Azure Blob storage and Azure Data Lake Storage Gen1. Features from Azure Data Lake Storage Gen1, such as file system semantics, directory, and file level security and scale are combined with low-cost, tiered storage, high availability/disaster recovery capabilities from Azure Blob storage.