Why not merge?
It gives you better high-level observability and a good bird's-eye view. And again -- if you need more details you can go and check all separate commits in the PR/branch anyway.
And finally, squashed commits are kind of atomic commits. Imagine history of three separate PRs happening at roughly the same time. And now all those commits are interspersed in the history of the main branch.
How is that useful or informative? It's chaos.
EDIT: my bad, I conflated merging with rebasing. Still, I prefer a single squashed commit for most of the reasons above, plus those of the other two commenters (useful git blame output and buildable history).
"Encrypt project's sensitive fields (#1234)"
With the number being a PR or an issue # (which does contain a link to the PR).
I do care about history in branches though. And many others do. I agree that it varies from team to team.
All due diligence is done there, not in the main branch.
The main branch only needs to have one big commit saying "merging PR #2169". If you need more details you'll go that PR/branch and get your info.
The "fix typo" commit being in the main branch buys you nothing. It's only useful in its separate branch.