Random string + encrypt/decrypt
Why Encryption Doesn't Fit the Goal of Password Storage

Cryptographic hashing and encryption have two different purposes. Hashing is not reversible -- given a hash, you can't determine what made it except by testing to see if a source input matches the hash output. When used for passwords, this becomes a validation only question: "does this password (mixed with this salt) match?" With passwords, the goal is to prevent somebody with full access to the database from recovering passwords.

Encrypting passwords handles that goal poorly. To verify a password, one must have the encryption key. That means one is also able to determine the source password from looking at the encrypted version of the password. In the event of a compromise, having those encrypted fields and the key will result in the disclosure of all passwords regardless of how strong they were.

Good Resources

https://security.stackexchange.com/questions/211/how-to-securely-hash-passwords

The Rules of Crypto

You'll hear it a lot around here: don't roll your own. The problem is that the field has changed too much for "common sense" to really be something that's working on our favor. Encryption and password issues have evolved relatively fast on a human-life scale of time. Where not everybody is following that, a lot of varying ideas exist about how to solve these problems and many of them have been proven wrong.

If you're not current, the proper approach is to research the issue you're trying to solve rather than the method you're trying to solve it with.