The SSH Page (Advanced Site Settings dialog)

The Enable compression checkbox enables data compression in the SSH connection: data sent by the server is compressed before sending, and decompressed at the client end.

WinSCP supports a variety of different encryption algorithms, and allows you to choose which one you prefer to use. You can do this by dragging the algorithms up and down in the list box (or moving them using the Up and Down buttons) to specify a preference order. When you make an SSH connection, WinSCP will search down the list from the top until it finds an algorithm supported by the server, and then use that.

WinSCP currently supports the following algorithms:

• AES (Rijndael) – 256, 192, or 128-bit SDCTR or CBC, or 256 or 128-bit GCM
• ChaCha20-Poly1305, a combined cipher and MAC
• Blowfish – 256-bit SDCTR or 128-bit CBC
• Triple-DES – 168-bit SDCTR or CBC
• Arcfour (RC4) – 256 or 128-bit stream cipher
• Single-DES – 56-bit CBC (see below)

If the algorithm WinSCP finds is below the warn below here line, you will see a warning box when you make the connection:

This warns you that the first available encryption is not a very secure one. Typically you would put the warn below here line between the encryptions you consider secure and the ones you consider substandard. By default, WinSCP supplies a preference order intended to reflect a reasonable preference in terms of security and speed.

In SSH, the encryption algorithm is negotiated independently for each direction of the connection, although WinSCP does not support separate configuration of the preference orders. As a result you may get two warnings similar to the one above, possibly with different encryptions.

Single-DES is not recommended in the SSH protocol standards, but one or two server implementations do support it. WinSCP can use single-DES to interoperate with these servers if you enable the Enable legacy use of single-DES option; by default this is disabled and WinSCP will stick to recommended ciphers.1

You can see actually used encryption algorithm on Server and Protocol Information Dialog.

Read more about Login dialog and Advanced Site Settings dialog.