Is there a way to mask credentials of the application under test from traces?

You can mask any input data using trace parameters. Expand the parameter tab of the step you want to mask. Replace the sensitive credential in the default value field with a placeholder value (any value). Now, note the parameter name, this is the parameter you need to define in an API call to execute traces. See the API documentation to learn how to define parameters for trace runs. Using this method, your credentials are not stored inside Usetrace cloud, but passed only inside API calls.