Restic key visibility with rclone --append-only

When restic is used with rclone serve restic --stdio --append-only
as described here: Restic - ArchWiki
where is the password/encryption key used? To add only new files the existing files on the remote server need to be read obviously, but does that happen on the server or on the client?
In other words, does the remote server get access to the password/encryption key?

No, it does not.

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