Beyond the Centralized Cloud: Unveiling the Security of Decentralized VPNs (DPNs)

VPN services were originally developed for the convenience of remote work, primarily to protect important data and prevent information leaks. However, it was unforeseen that they would eventually pose a threat to user security.

In the pursuit of anonymity and security, people connect to VPNs to hide their locations, giving rise to the era of "anonymous users." But can popular VPN services, which everyone has become accustomed to, truly offer sufficient anonymity and security?

Traditional VPNs operate in a centralized manner, with all data passing through a single point. When launching the VPN application, the server has visibility into all the user's network traffic. There is uncertainty about the trustworthiness of the server owner and whether they might exploit the data for commercial purposes. As a result, centralized VPNs can potentially compromise the confidentiality of data.

To address this issue, decentralized VPNs (or DPNs) have emerged, eliminating the centralized service system.

Decentralized VPNs play a crucial role in the next-generation internet infrastructure. The advantage of such servers is that users gain access to private networks without the risk of personal information leakage.

However, the question remains: are the DPNs available in the market truly secure? We will explore this matter shortly, but first, let's understand how traditional VPNs typically function.

Traditional VPNs: Key Points

Traditional VPNs establish encrypted connections with the provider's server and create a "tunnel" for all user activity. This allows users to access the internet while routing all their traffic through the server.

Developers claim that VPNs mask users' IP addresses and prevent any form of tracking by third parties.

Despite the strong claims made by centralized VPNs regarding flawless privacy and security, the reality is not always straightforward.

While traditional VPNs deny the possibility of user traffic leaks on the network, there is no guarantee that such incidents do not occur. VPN servers have visibility into all the user's network traffic, increasing the risk of data being sold to third parties. For example, applications like DashVPN, Neopard, and DashNet were found to intercept user traffic, enabling app administrators to view customers' private conversations in Gmail, as reported by "Tinkoff Magazine."

Additionally, VPN server locations can be restricted. In several countries, VPN servers are partially or completely prohibited, creating challenges in finding a suitable server. Currently, such restrictions exist in Russia, China, Iraq, the UAE, Turkey, Belarus, Oman, Iran, North Korea, Myanmar, and Turkmenistan, as reported by vpnmentor.

In addition, residents of countries where VPNs are banned often face difficulties in accessing desired locations with reliable connections due to the high subscription fees they have to pay.

What are decentralized VPNs and how do they operate?

A decentralized VPN, also known as DPN or dVPN, is a virtual private network that operates without centralized control over the server.

Instead of relying on a single server, DPNs utilize multiple servers located in different parts of the world. Additionally, devices equipped with dVPN software can be found in various locations, and users pay for the usage of the service.

In terms of user experience, DPNs are similar to traditional VPNs. Users simply need to open the application and select the desired server location. However, the underlying system supporting this process is more complex compared to traditional VPNs.

When using a centralized VPN, users can always see their virtual location and the service provider. However, when using a decentralized VPN, this information is not visible. Only the location is displayed, while the provider remains anonymous.

The main distinction between DPNs and traditional VPNs is that DPNs require the use of cryptocurrency, as reported by guidepc.ru. Instead of the conventional payment model, users purchase digital currency when connecting to the service. This digital currency is later used to pay the node owner. It is worth noting that this payment method is often more favorable than the subscription fees charged by VPN applications.

Another difference lies in the payment structure and network routing of DPNs. DPN providers handle payments differently compared to traditional providers. DPN providers operate network nodes and share their processing power in exchange for tokens purchased by users. Additionally, the network speed in a decentralized VPN depends on the number of users. More users result in a faster network.

Furthermore, DPNs are often multi-routed. While traditional VPNs sometimes provide only a single route for data transmission on the internet, DPNs offer more flexibility. Users can switch between different routes and servers, allowing them to choose the one that offers higher speeds and better convenience.

Now, let's explore the existing types of DPNs and their unique characteristics.

Hardware-based DPNs

These are physical devices that function as private networks.

Customers can access the internet through these devices after making a one-time purchase, without requiring a subscription. Users of hardware-based DPNs can also share their unused internet with others and earn profits from it.

Hardware-based DPNs are typically connected to physical user devices like smartphones, tablets, or computers, providing reliable protection and private access to any connected network.

One example of a hardware-based DPN is Deeper Network, which utilizes blockchain technology and has its own DPR token. A notable advantage of this hardware-based DPN is its ability to block GPS beacons on devices and other monitoring software.

Software-based DPNs

Decentralized VPN software offers similar functionality to hardware-based DPNs, including decentralized data encryption and IP address modification.

However, the software can only be installed on the user's device as an application. This means that data is encrypted on the user's device rather than on a third-party server.

An example of such software is Mysterium Network, which operates on Android devices. In 2021, the network had over 1800 connections from 80 countries worldwide. Mysterium Network allows users to run their own nodes to manage the VPN network and sell excess access to others through tokens.

Mysterium Network implements a micro-payment system and accepts its own token, MYST, as payment, charging users based on their chosen tariff. This ensures that clients do not overpay, and unused internet data does not go to waste until the next payment cycle.

Additionally, Mysterium DPN enables users to create a node on their smartphone or computer without the need for additional hardware.

Can decentralized VPNs be fully trusted?

Traditional VPNs carry risks such as internet traffic leaks and the potential sale of user data to third parties. DPNs were developed to address these issues in centralized networks.

However, it is important to exercise caution when using decentralized VPNs. Specifically, one should pay attention to the tokens used by the networks and how transparently and for what purposes they are utilized.

It is essential to examine publicly available information regarding the use of token sale revenues before investing your money. The funds generated from token sales can serve various purposes, including enhancing connection quality and security. However, it is crucial to ensure that the organizers of the decentralized VPN allocate these funds appropriately. If the sole focus is on personal enrichment rather than safeguarding user data, it can have detrimental effects on the privacy and security of clients.