Does Edge's sync use end-to-end encryption by default?

End-to-end encryption (enduser-to-enduser encryption) is a concept where communication is encrypted directly between the users of a system, whereas many systems just provide encryption between each individual user and the service provider.

Microsoft uses TLS so data is encrypted on user side and gets decrypted on the server side, so that the data can be stored on the server. no 3rd party should be able to eavesdrop on the connection.

using E2E encryption means that the user doesn't even trust Microsoft servers, or Google servers in case of Google Chrome browser.

Note that technically speaking, any secure communication tunnel provides encryption between two ends, but the term end-to-end encryption is usually applied to messaging services or, more generally, the secure communication between users of a service but not between a user and the service provider itself.

so you see E2EE is not really necessary if you are dealing Directly with Microsoft servers, Not other users.