Replace
<asp:BoundField DataField ="password" HeaderText ="PASSWORD" InsertVisible ="False" ReadOnly ="True" SortExpression ="password"/>
with
<asp:TemplateField HeaderText="Password">
<EditItemTemplate>
<asp:TextBox ID="txtPassword" runat="server" TextMode="Password" Text='<%# Bind("Password") %>'></asp:TextBox>
</EditItemTemplate>
<ItemTemplate>
<asp:TextBox ID="TextBox2" Enabled="false" runat="server" TextMode="Password" Text='<%# Bind("Password") %>'></asp:TextBox>
</ItemTemplate>
</asp:TemplateField>
Hope this will help.