In order to support block device encryption cryptsetup-luks package can be a useful addition to Yocto.
A recipe for cryptsetup exists in meta-oe. The question is are we talking about integrating support for creating encrypted rootfs images, or just providing the recipe?
Thanks for pointing this out. I hadn't seen this recipe when I did my initial scan. It is not the first, nor the last time I miss seeing something right under my nose. The request was just for the recipe so we are good here, I will mark this as an invalid request.
verified as per above comment