Yes, by default messages get encrypted and then encoded into base64 on the client side before they are sent to the server.
What happens to a message after it has been read?+
Each message is deleted from memory upon fetching it from the server, this means that even if your decryption keys are bad it will still be deleted.
Where are messages stored?+
Messages are stored in memory on the server, meaning the messages are never saved to a filesystem. However as memory size is limited, your message may get deleted to allow new messages in. Oldest message gets deleted first.
What data is processed?+
The only data apart from the message contents (which by default get encrypted) is time of when the message was created. The purpose of this is simply to enable deletion of old message to allow storage in memory for newer ones.
Do you store any logs?+
Your privacy is valued. Timestamps of note creations and ratelimiting functions are the only pieces that may be seen as logging. Apart from this the server stores no concrete logs of who visits the website and when or from where.