Encrypted loop device on boot

There are a lot of tutorials on how to setup an encrypted LUKS home / root / swap partitions available, but I couldn't find any description about setting up an encrypted loop device on boot. It's easy to create an encrypted file and mount it manually, but I just couldn't find a way to configure it with /etc/crypttab to have it mounted on boot. So, here is the solution for Ubuntu 8.04 (should work on other distros that support crypttab too):

1. Create an encrypted file first - this is covered in a lot of tutorials, but let's do it here (you need to be root to do this):
   
   • create empty /.cryptdata file
     dd if=/dev/zero of=/.cryptdata count=10 bs=1M
   • mount it via loop device
     losetup /dev/loop0 /.cryptdata
   • create an encrypted volume out of it
     cryptsetup luksFormat /dev/loop0
   • open the volume
     cryptsetup luksOpen /dev/loop0 cryptdata
   • format the volume (create filesystem)
     mke2fs -j /dev/mapper/cryptdata
     
2. Add the following entry to /etc/crypttab:
   cryptdata /.cryptdata none luks
3. Add the following entry to /etc/fstab:
   /dev/mapper/cryptdata /home/cryptdata ext3 relatime 0 2
4. Create mountpoint for the encrypted filesystem:
   mkdir /home/cryptdata
   

Starting from now, the encrypted file will be mounted via loop device on system startup; you'll be asked for encryption password.