If you open the vault files from an IceDrive app (I’m assuming such an app exists), then in theory the files would be encrypted.
If you plan to open the files from within the Obsidian app, then things get slightly more complicated. If you use Obsidian Sync rather than a 3rd-party cloud service, that should be encrypted. If you use a third-party cloud service, the answer depends on whether whatever 3rd-party tools you’re using are using encryption.
For example, on Android I use an app that syncs my Dropbox content with a local folder on my Android phone. The Obsidian app reads the local files on the Android phone and any changes I make through the Obsidian app are saved to the local folder, which the app syncs back to my Dropbox directory. Is this process encrypted? No, I don’t think so. Could it be, if I were using apps or services with this feature? I assume so.