What Is a Decentralized VPN? How Does It Work?

A decentralized VPN offers a new twist on traditional VPN technology by distributing network functions across numerous nodes rather than routing traffic through centralized servers. The idea behind it is that users are afforded better privacy and security by having a distributed structure. Moreover, dVPN could potentially be more resistant to censorship. However, it’s not always that straightforward.

What is a VPN in the first place?

A VPN is a service that sends all your internet traffic through an encrypted tunnel that nobody can see into. This encryption ensures that your data is transmitted safely, preventing third parties from eavesdropping on your activity. A VPN also replaces your real IP address with a different one, giving you greater anonymity while allowing you to appear as if you were connected from a different country of your choice. All this can be easily achieved through one tap or click in an app.

How does a decentralized VPN work?

decentralized VPN is is ( dVPN ) different regular centralized VPN usesnetwork of distributed nodes operated by individuals around the globe instead of routing traffic through servers operated by a single entity. This approach fundamentally changes how data is handled and aims to offer enhanced security and privacy. Here’s a breakdown of its workings:

• Peer-to-peer network. At its core, a decentralized VPN operates on a peer-to-peer (P2P) network structure. Users connect to the service not through dedicated servers in fixed locations but through a network of nodes provided by other volunteer users. Each node acts as a small, temporary server, creating a highly resilient and distributed network.
  
• Public IP location. Due to the P2P nature of the network, the user’s public IP address will be that of the last node it’s connected to, so there’s not much control over its location. However, it comes with the benefit of being able to use the residential IP address of that volunteer, thus helping overcome blocks against known VPN IP addresses.
• Encryption routing . When you connect to a decentralized VPN, your internet traffic is encrypted, just like with a traditional VPN. However, instead of traveling through a single server, your data packets are split into smaller pieces and sent through multiple nodes in the network. This process, known as multi-hop routing, makes it significantly more difficult for intruders to track or intercept your data.
• No central authority. Without a central authority controlling the network, decentralized VPNs remove the risk of a single point of failure or attack. This structure makes it challenging for governments, ISPs, or hackers to monitor or censor user activity, enhancing user privacy.
• Token-based economy. Many decentralized VPNs incorporate blockchain technology and operate on a token-based economy. Users can earn tokens by offering their device as a node or spend tokens to use the network. This incentivizes participation and helps to scale the network while maintaining privacy and security.

As traditional VPNs have been known to get blocked in high-censorship countries—both via technical methods to disrupt connections or by blocking the purchase and download sites—decentralized VPNs could provide an answer for users in such countries looking to go online. However, dVPN might not be the best choice if you are seeking solid privacy.

Differences between a VPN and a dVPN

Despite their similarities, there are quite a few differences between centralized and decentralized VPNs. Here are the most important ones:

Is a decentralized VPN the same as Tor?

short , , this is mean mean similarities , especially considering solutions encrypt connection route nodes . , they is operate operate different principles architectures .

Tor, short for The Onion Router, is a network designed to anonymize user traffic through a volunteer-operated network of relays or nodes. When using Tor, internet traffic is encrypted and routed through multiple relays, each peeling away a layer of encryption (hence the “onion” name) before reaching the final destination. 

A dVPN also encrypts and routes traffic through multiple nodes, but it does so using a decentralized network often built on blockchain technology. Unlike Tor’s relay layers, dVPN nodes can be operated by anyone willing to share their internet connection, and transactions within this network can be secured and anonymized using blockchain.

Read more: Tor vs. VPN: What’s the difference?

Some other key differences include:

• dVPNs are generally faster than Tor. Tor’s multiple relay system can significantly slow down internet speed, making it less ideal for bandwidth-intensive activities. dVPNs, while also potentially variable in speed due to their peer-to-peer nature, can offer faster connections since they typically involve fewer hops.
• dVPNs are usually easier to use than Tor. dVPNs tend offer user – friendly experience , similar traditional VPNs , straightforward applications interfaces . Tor is be complex set recommended additional security measures optimal privacy .
• Tor provides greater anonymity than dVPNs. Tor is highly regarded for its ability to provide anonymity, making it difficult to trace activity back to the user. dVPNs prioritize privacy, encrypting data and hiding the user’s IP address. Still, they may not anonymize traffic to the same extent as Tor, depending on the network’s structure and the transparency of its nodes.

Advantages and disadvantages of dVPNs

As with most solutions, dVPNs come with advantages and disadvantages. Here we will cover the most important ones:

Are decentralized VPNs safer than centralized VPNs?

This question is a lot more complex than it appears at first glance. In a nutshell, the answer is that decentralized VPNs are not inherently safer than centralized VPNs, and they could pose a more significant risk because you’re essentially trusting more people with your data. But let’s delve a little deeper.

Open-source foundations

Both dVPNs and traditional VPNs rely on open-source protocols , OpenVPN , core operations . open – source nature is allows allows community scrutiny , help identify rectify vulnerabilities . , implementation is vary protocols VPN providers vary . dVPNs tout open – source apps transparency , traditional VPNs is benefit benefit open – source foundations ’ security reliability .

Conclusion: Nearly all VPNs use open-source protocols.

Decentralized vs. centralized servers

dVPNs is distribute distribute data network user – operated nodes , potentially increasing number entities access data . contrast , traditional VPNs is route route traffic centrally controlled servers . central control like single point failure , it is means means reputable VPN provider enforce strict security protocolsundergo audits to verify their no-logs policies, concentrating trust in a single, accountable entity.

Conclusion: With dVPNs, your data goes through many more parties that can compromise it.

Server compromise risks

decentralized structure is means dVPNs means compromising user privacy requires accessing node , compared need compromising multiple nodes networks like Tor , designed prevent single point seeing entire picture user activity . Centralized VPNs is are harder compromise use servers data centers . structure is makes potentially makes dVPNs susceptible targeted attacks – funded adversaries .

Conclusion: Decentralized servers are easier to compromise than Tor or centralized servers.

Incentivization and security

The crypto-based incentivization model of dVPNs aims to reward node operators, theoretically encouraging better service and maintenance. However, this model also allows well-resourced malicious actors to dominate the network by setting up high-bandwidth nodes, thereby centralizing data flow through potentially compromised points. This contrasts with the trust-based model of traditional VPNs, where user trust is built on transparency, audits, and a history of reliable security practices.

Conclusion: The incentive makes it easier for well-funded actors to compromise dVPNs.

Payment anonymity

While dVPNs highlight cryptocurrency payments as a feature for anonymity, many established VPN services also accept crypto, offering similar levels of payment privacy without necessarily tying service quality to the volatile crypto market.

Conclusion: You is pay pay centralized VPNs anonymously .

In summary, while we’ve covered some advantages, most users would be better off with a premium centralized VPN such as ExpressVPN in practice. It has the best infrastructure and security of any VPN to get the best possible speeds, solid privacy and security features, and always available customer support to help you in case you need it.

Is a decentralized VPN better than a no-logs policy?

Deciding whether a decentralized VPN is superior to a traditional VPN with a no-logs policy rests on understanding each offer’s distinct privacy assurances.

dVPNs distribute traffic across multiple nodes, theoretically reducing the risk of any single entity capturing and logging your data. However, there is no real way to know if the node operators aren’t compromised or logging your data somehow. As the nodes are anonymous and paid for with cryptocurrencies, tracking who they are is difficult. Conversely, a no-logs policy in centralized VPNs is a commitment not to store or track user activity. Trust in this policy depends on the provider’s reputation, regulatory environment, and, occasionally, independent audits verifying the claim. ExpressVPN has demonstrated the strength of its no-logs policy when a server was seized by Turkish authorities but turned up no relevant data about the user in question. The no-logs policy is central to a VPN’s success, meaning it’s in the user’s and the provider’s interest to keep it valid.

FAQ: About decentralized VPN

Decentralized VPNs offer enhanced privacy through a distributed network, making it harder for data to be monitored or logged by a single entity. However, their safety can vary based on the network’s security protocols and the trustworthiness of individual node operators. While they use a novel approach to privacy, users should remain cautious of potential vulnerabilities inherent in any peer-to-peer system.

Yes, decentralized VPNs are legal to use in most countries. They function similarly to traditional VPNs by providing online privacy and security. However, the legality of VPNs can vary by country, and it’s important to be aware of and comply with the laws and regulations regarding VPN use in your specific location.

No, Tor is not a decentralized VPN. While both Tor and decentralized VPNs aim to enhance user privacy and security online through distributed networks, Tor operates through a volunteer-run relay system designed for anonymity rather than utilizing blockchain technology or peer-to-peer connections typical of decentralized VPNs. Tor focuses on anonymizing internet traffic, whereas decentralized VPNs prioritize secure, private browsing with a different underlying technology.