First, I selected the Arch VM from virtualbox on the right
I clicked on storage. From the CD/DVD controller I choose to boot from a arch iso file.
Once the arch iso booted, I opened the encrypted device
cryptsetup luksOpen /dev/sda2 root
I enter my passphrase.
Next I mounted the lvm-root volume on /mnt and /dev/sda1 on /mnt/boot
mount /dev/mapper/lvm-root /mnt
mount /dev/sda1 /mnt/boot
I follewd this step from the arch wiki GRUB root encryption
Do not do the regenerate the configuration yet. This comes later.
After editing the /mnt/etc/default/grub file I ran these commands
grub-mkconfig -o /boot/grub/grub.cfg
shutdown -h now
I release the arch iso image so it won't boot and I boot up Arch normally.
When I booted into arch I was prompted for the passphrase of the crypted device. After I entered my passphrase it booted the system. I got the login prompt and logged into my system.