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The Data Quality REST web service only supports plain-text authentication as of now. The error you are facing is because you are trying to pass the encoded password instead of the plain-text. However, when you pass the plain-text username and password, the REST client (Postman in this case) generated an authentication header and the username and password are sent in the encoded form.
If you wish to improve the security, it is recommended to enable HTTPS for the DIS instead of using plain HTTP.
Let me knnow if this helps.