Hi I want to restore my stuff from iCloud and it says your passcode is encrypted and cannot be read by apple

It would be better if you can please re-post with a screenshot, in order to understand the phenomenon better. Images/pictures speak louder than words. 

Please understand this is a public forum: While attaching a Screenshot, do not provide any personal credentials, such as Card detail, email id, apple id, IMEI number, Serial Number, Phone number, Order ID, if you are sharing a map ensure your location is not identifiable, etc.

Restore your device from an iCloud backup

1. Turn on your device. ... 
2. Follow the onscreen setup steps until you reach the Apps & Data screen, then tap Restore from iCloud Backup.
3. Sign in to iCloud with your Apple ID.
4. Choose a backup.

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Restore your iPhone, iPad, or iPod touch from a backup ...