Can I encrypt notifications sent through Pushy?

Yes.

If you have data privacy concerns, you can choose to encrypt the push notification payload on your servers and decrypt it within your app, using AES-256, for example.

You can also avoid sending any sensitive data through Pushy, and instead, either send a database identifier (so your app can fetch the sensitive data from your servers using this identifier), or simply send an empty push notification to wake your app so it can fetch the relevant updates from your own servers instead.