http://sparrowa7io5pz6ud3ehqzosvepbxbxt2zphmkjsylp2zgxooko23pqd.onion/docs/best-practices.html
If your wallet software is connecting directly to Bitcoin Core, you are using Bitcoin Core’s wallet internally.
This is true not only for Sparrow in this configuration, but always true for Specter, FullyNoded, and of course the Bitcoin Qt wallet itself.
Unfortunately, Bitcoin Core stores your public keys and balance unencrypted on the computer it is running on.