You don’t need two passwords – you need one, your AxCrypt 2 password.
If you’ve upgraded from AxCrypt 1.7 to AxCrypt 2 then the old password is needed to decrypt your files (naturally) and then you type in your AxCrypt 2 password once per session (until you log-out, lock your screen etc.)
AxCrypt 2 will upgrade your old files to the newer format and thereafter only one password is required.
The file shred feature still works. I’m a Premium customer but the shred function is limited to paying customers. Basic functions are free, super-strong (AES-256 bit) encryption, mobile apps etc. is premium – €24.00 / year (about $25 or £20).
You can still use AxCrypt 1.7 if you’re happy with the old encryption (AES-128 bit) and multiple password setup.