diff --git a/src/engine/panel-protection/archive-background.test.ts b/src/engine/panel-protection/archive-background.test.ts
index c97aa35..31b137e 100644
--- a/src/engine/panel-protection/archive-background.test.ts
+++ b/src/engine/panel-protection/archive-background.test.ts
@@ -1,5 +1,5 @@
 import { test, expect } from "bun:test";
-import { mkdtempSync, writeFileSync, rmSync } from "node:fs";
+import { mkdtempSync, writeFileSync, rmSync, openSync, ftruncateSync, closeSync } from "node:fs";
 import { tmpdir } from "node:os";
 import path from "node:path";
 import { randomBytes } from "node:crypto";
@@ -21,3 +21,17 @@ test("backup compression leaves the request event loop responsive and preserves
     expect(Buffer.from(decryptArchive(encrypted, key).database, "base64").equals(database)).toBe(true);
   } finally { rmSync(dir, { recursive: true, force: true }); }
 });
+
+test("a large database snapshot does not require database-sized JSON copies in memory", async () => {
+  const dir = mkdtempSync(path.join(tmpdir(), "ocd-large-backup-"));
+  try {
+    const snapshotPath = path.join(dir, "deploy.db");
+    const fd = openSync(snapshotPath, "w");
+    ftruncateSync(fd, 160 * 1024 * 1024);
+    closeSync(fd);
+    const before = process.resourceUsage().maxRSS;
+    const encrypted = await encryptSnapshot({ snapshotPath, key: generateRecoveryKey(), archive: { version: 1, createdAt: new Date().toISOString(), image: "test", schemaVersion: 1, jwtSecret: "test", ssh: {} } });
+    expect(encrypted.length).toBeGreaterThan(0);
+    expect((process.resourceUsage().maxRSS - before) * 1024).toBeLessThan(128 * 1024 * 1024);
+  } finally { rmSync(dir, { recursive: true, force: true }); }
+}, 30_000);
diff --git a/src/engine/panel-protection/archive-background.ts b/src/engine/panel-protection/archive-background.ts
index e38f341..4d695f2 100644
--- a/src/engine/panel-protection/archive-background.ts
+++ b/src/engine/panel-protection/archive-background.ts
@@ -6,14 +6,21 @@ import type { PanelArchive } from "./archive.ts";
 export function encryptSnapshot(input: { snapshotPath: string; databasePath?: string; key: string; archive: Omit<PanelArchive, "database" | "databaseSha256"> }): Promise<Buffer> {
   return new Promise((resolve, reject) => {
     const worker = new Worker(new URL("./archive-worker.ts", import.meta.url), { workerData: input });
+    const timeout = setTimeout(() => {
+      void worker.terminate();
+      reject(new Error("Panel archive worker timed out"));
+    }, 120_000);
+    timeout.unref();
     let received = false;
     worker.once("message", (bytes: Uint8Array) => {
+      clearTimeout(timeout);
       received = true;
       resolve(Buffer.from(bytes.buffer, bytes.byteOffset, bytes.byteLength));
       void worker.terminate();
     });
-    worker.once("error", () => reject(new Error("Panel archive encryption failed")));
+    worker.once("error", () => { clearTimeout(timeout); reject(new Error("Panel archive encryption failed")); });
     worker.once("exit", () => {
+      clearTimeout(timeout);
       if (!received) reject(new Error("Panel archive worker exited without a backup"));
     });
   });
diff --git a/src/engine/panel-protection/archive-worker.ts b/src/engine/panel-protection/archive-worker.ts
index 62d8007..f63faae 100644
--- a/src/engine/panel-protection/archive-worker.ts
+++ b/src/engine/panel-protection/archive-worker.ts
@@ -1,7 +1,7 @@
 import { parentPort, workerData } from "node:worker_threads";
-import { readFileSync, statSync } from "node:fs";
+import { statSync } from "node:fs";
 import { Database } from "bun:sqlite";
-import { encryptArchive, sha256, MAX_ARCHIVE_BYTES, type PanelArchive } from "./archive.ts";
+import { encryptSnapshotArchive, MAX_ARCHIVE_BYTES, type PanelArchive } from "./archive.ts";
 
 const input = workerData as { snapshotPath: string; databasePath?: string; key: string; archive: Omit<PanelArchive, "database" | "databaseSha256"> };
 try {
@@ -18,8 +18,7 @@ try {
     } finally { snapshot.close(); }
   }
   if (statSync(input.snapshotPath).size > MAX_ARCHIVE_BYTES / 2) throw new Error("Snapshot exceeds backup size limit");
-  const database = readFileSync(input.snapshotPath);
-  const encrypted = encryptArchive({ ...input.archive, database: database.toString("base64"), databaseSha256: sha256(database) }, input.key);
+  const encrypted = await encryptSnapshotArchive(input.snapshotPath, input.archive, input.key);
   const bytes = new Uint8Array(encrypted);
   parentPort!.postMessage(bytes, [bytes.buffer]);
 } catch {
diff --git a/src/engine/panel-protection/archive.ts b/src/engine/panel-protection/archive.ts
index 86c580f..4d61384 100644
--- a/src/engine/panel-protection/archive.ts
+++ b/src/engine/panel-protection/archive.ts
@@ -1,5 +1,8 @@
 import { createCipheriv, createDecipheriv, createHash, randomBytes } from "node:crypto";
-import { gzipSync, gunzipSync } from "node:zlib";
+import { gzipSync, gunzipSync, createGzip } from "node:zlib";
+import { createReadStream } from "node:fs";
+import { Readable, Writable } from "node:stream";
+import { pipeline } from "node:stream/promises";
 
 const MAGIC = Buffer.from("OCD-BACKUP-1\n");
 export const MAX_ARCHIVE_BYTES = 512 * 1024 * 1024;
@@ -26,6 +29,41 @@ export function encryptArchive(archive: PanelArchive, key: string): Buffer {
   const compressed = gzipSync(JSON.stringify(archive));
   return Buffer.concat([MAGIC, iv, cipher.update(compressed), cipher.final(), cipher.getAuthTag()]);
 }
+
+/** Preserve the archive format without materializing the database, its base64
+ * string and a second JSON copy together on a small production panel. */
+export async function encryptSnapshotArchive(snapshotPath: string, archive: Omit<PanelArchive, "database" | "databaseSha256">, key: string): Promise<Buffer> {
+  const hash = createHash("sha256");
+  for await (const chunk of createReadStream(snapshotPath)) hash.update(chunk);
+  const metadata = { ...archive, databaseSha256: hash.digest("hex") };
+  async function* json() {
+    yield JSON.stringify(metadata).slice(0, -1) + ',"database":"';
+    let remainder = Buffer.alloc(0);
+    for await (const chunk of createReadStream(snapshotPath)) {
+      const bytes = remainder.length ? Buffer.concat([remainder, chunk]) : chunk as Buffer;
+      const end = bytes.length - bytes.length % 3;
+      if (end) yield bytes.subarray(0, end).toString("base64");
+      remainder = Buffer.from(bytes.subarray(end));
+    }
+    if (remainder.length) yield remainder.toString("base64");
+    yield '"}';
+  }
+  const iv = randomBytes(12);
+  const cipher = createCipheriv("aes-256-gcm", keyBytes(key), iv);
+  cipher.setAAD(MAGIC);
+  const chunks: Buffer[] = [MAGIC, iv];
+  let size = MAGIC.length + iv.length + 16;
+  await pipeline(Readable.from(json()), createGzip(), cipher, new Writable({
+    write(chunk: Buffer, _encoding, done) {
+      size += chunk.length;
+      if (size > MAX_ARCHIVE_BYTES) return done(new Error("Backup exceeds maximum archive size"));
+      chunks.push(Buffer.from(chunk));
+      done();
+    },
+  }));
+  chunks.push(cipher.getAuthTag());
+  return Buffer.concat(chunks);
+}
 export function decryptArchive(bytes: Buffer, key: string): PanelArchive {
   if (bytes.length > MAX_ARCHIVE_BYTES || !bytes.subarray(0, MAGIC.length).equals(MAGIC) || bytes.length < MAGIC.length + 28) {
     throw new Error("Unsupported panel backup");