Obsidian Sync has received a minor security upgrade. File names have always been end-to-end encrypted, but they're now protected using an even stronger method. All new vaults automatically use this stronger encryption. Existing vaults can be upgraded with the new migration assistant in Obsidian 1.9.11.
The old method of encrypting file paths and hashes derived the initialization vector (IV) from a hash of the string. In rare cases, this could create a pattern that an attacker might try to take advantage of if they were able to get access to your encrypted data. Now, file paths and hashes are encrypted with AES-SIV so those patterns can no longer exist.
The way file contents are encrypted hasn't changed, they've always been secured with AES-GCM.