[tantalor]

If this was sensitive data why was it not encrypted?

Replace "bitcoin wallet" with "medical history" or "credit card numbers".

[regularfry]

It had to be decrypted to be used. It was in use. Ergo...

[singlow]

It had to be rebooted to reset the root password. I see no good reason not to have a decryption key held in memory and require you to log in and enter the key upon reboot for something this important.