File can be PUBLIC or PRIVATE, the public attribute of input data that is sent together with file means the file will not be listed by listing endpoint (unless the token is not an administrative token).

Password protection could be used to protect from downloading the file content by not authorized person, and also it will anonymize the file in public listing if the person who lists the files will not know the password.

Uploading restrictions

When you give user a temporary token to allow to upload eg. avatar, then you may require that the file will not have a password, and possibly enforce to select some tags as mandatory.

Extra roles, that can restrict the token
name description
upload.enforce_no_password Enforce files uploaded with this token to not have a password
upload.enforce_tags_selected_in_token Regardless of tags that user could choose, the tags from token will be copied into each uploaded file