This issue because of your hard drive or USB drive was corrupted or NTFS incorrectly determines that the name of a parent folder does not change when NTFS opens a file.
For example, one thread might rename a file at the same time that the other thread moves the same file. NTFS then tries to remove a link that no longer exists to the file. Therefore, NTFS generates the error message that is listed earlier in this article. Ref. Source https://support.microsoft.com/en-in/help/867525/you-receive-a-the-file-or-directory-is-corrupt-and-unreadable-error-me .
This is not realted to AxCrypt application. You can resolve the same by searching the issue on the internet.