Bitcoin core keeps 100 addresses by default pregenerated for you. You can change this with -keypool[1]. If it would not do that it would require a password every time you clicked the "new" button in the receiving addresses window. This is because you cant have a new address without a private key. Well you can, but you would not be able to spend the bitcoin, so its not what anyone wants. Since bitcoin is not a HD wallet it needs to randomly generate and store every private key it manages for you. To store them safely they are encrypted with your password. Whenever the wallet is unlocked the keypool is refilled with new random private keys and addresses for them. This e.g. happens when you spend bitcoin or sign a message. Since you have used the hidden pool of available private keys (hidden key pool has 0 keys left) and addresses it asks you for the password to generate new addresses and keys.
[1] https://en.bitcoin.it/wiki/Running_Bitcoin
Ok so let me see if I understood this. It's asking for my password because it just means I already created 100 keys, so I need to put my password, then I will be able to create 100 more keys, and after I create those 100 more keys, I will be asked to enter password again (because keeypolsize is set to 100). Something like that?
Anyway, so Im assuming its normal behavior and there's nothing to worry. Thanks.
Correct.