Comment 10 for bug 1744758

Lee, thanks very much for the recreate details. I was able to recreate the error you were seeing, and also tested successfully with libvirt installed from ppa:corey.bryant/xenial-ocata-bug1744758.

$ apt policy libvirt-bin
libvirt-bin:
  Installed: 2.5.0-3ubuntu5.6~cloud1~ubuntu16.04.1~ppa201801231058
  Candidate: 2.5.0-3ubuntu5.6~cloud1~ubuntu16.04.1~ppa201801231058
  Version table:
 *** 2.5.0-3ubuntu5.6~cloud1~ubuntu16.04.1~ppa201801231058 500
        500 http://ppa.launchpad.net/corey.bryant/xenial-ocata-bug1744758/ubuntu xenial/main amd64 Packages
        100 /var/lib/dpkg/status

$ cat /tmp/disk.xml
<disk type="file" device="disk">
 <driver name="qemu" type="qcow2" cache="none" io="native"/>
 <source file="/var/lib/libvirt/images/test.img"/>
 <target dev='vdb' bus='virtio'/>
 <encryption format='luks'>
  <secret type='passphrase' uuid='8b0c5785-9e28-4c39-8b5d-21b42446ce45'/>
 </encryption>
</disk>

$ sudo virsh attach-device test /tmp/disk.xml
Device attached successfully

Since this seems to be working I'll go ahead and get this uploaded to ocata-proposed for more testing.