What are decentralized VPNs? Possible benefits and risks

Anton P. | November 21, 2022

Decentralized VPNs or dVPNs represent VPN services that do not have a single entity controlling their servers. Instead, it operates with the help of blockchain, smart contracts, and other users. 

Ideally, such VPNs are mostly self-governing infrastructures consisting of volunteers that set up nodes. 

However, how are decentralized VPNs different from a traditional Virtual Private Network? And is it realistic to assume that dVPNs are safer or better than standard providers?

Understanding decentralized VPNs 

Decentralized VPNs refer to VPNs that do not have centralized control over server networks. Instead, they consist of many users offering their unused network traffic to others. 

So, instead of connecting to servers controlled by owners of VPN services, you join independent nodes. Providers also design dVPNs around blockchain projects. 

Decentralized VPNs bring earning opportunities by allowing users to contribute to the service. For instance, almost anyone can become a node in dVPNs by setting it up without special hardware. Usually, node owners are compensated via cryptocurrencies or special tokens.

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How do decentralized VPNs work? 

Decentralized VPNs showcase the opportunity for people to become both users and service providers. So, the goal here is to create a peer-to-peer network, eliminating the need for a central point of control. 

People can onboard their nodes using laptops or mini-computers like Raspberry Pi. 

Such services also generate VPN tunnels for rerouting data. Open-source VPN protocols that are common in standard services are also present. 

The IP addresses get issued to clients depending on the routing rules, nodes, and tunnels. As with both regular and decentralized VPNs, users can pick the locations they prefer.

So, the usage of decentralized VPNs resembles traditional Virtual Private Networks. dVPN providers will likely offer software that interested users install. 

After setup, they can see all the available nodes. While connecting, users might notice other features, like choosing DNS providers or enabling a kill switch. 

The pricing for decentralized VPNs also differs. For instance, some might offer subscriptions, meaning users pay set fees for unlimited access. However, some dVPNs take a different path when users need to pay only for the bandwidth they use. 

Are decentralized VPNs safer than traditional VPNs? 

In theory, decentralized VPNs can operate without a central party controlling their servers. However, it does not mean that dVPNs are more secure by default. 

  • Like any other service, dVPNs might be unreliable or struggle to perform all security measures for browsing the web privately. 
  • In other cases, dVPN could compromise internet speed due to infrastructure drawbacks or contributors. 
  • Traffic encryption is a priority for all users interested in Virtual Private Networks, centralized or not. 
  • Therefore, when choosing a dVPN service, knowing exactly how it deals with your data is crucial. Only then can you trust services and rent an IP address in such open marketplaces. 

Furthermore, decentralized VPNs require you to trust the contributors, offering their bandwidth and IP addresses. A faulty service could leave security gaps, facilitating snooping by node owners. 

Therefore, choosing a dVPN or regular VPN requires research to get a more secure internet connection. In both cases, you can stumble upon unreliable products that, unfortunately, lead to data breaches and theft. 

Are decentralized VPNs similar to Tor?

The Tor browser resembles dVPNs because of its decentralized structure. Tor is like this by design, and there is no way of knowing all onion services. In a way, dVPNs mimic Tor infrastructure and node functionality. 

However, decentralized VPNs only reroute traffic through one node. Tor is different as it traverses data through at least three nodes.

What about traffic blame when sharing IP addresses? 

People contributing their IP addresses to decentralized VPNs should know who is responsible for traffic initiated by their clients. For instance, what if connected users exploit their bandwidth for illegal activities such as child pornography or harassment? 

In the worst-case scenarios, authorities could see node owners as their wanted culprits.

A no-logs policy or decentralized VPN? 

One of the biggest perks of decentralized VPNs is that there should be no opportunity for centralized logs. However, there are specific issues related to the way decentralized services work. 

  • Services could exploit users’ bandwidth. Contributing some of your bandwidth seems harmless. However, suspicious dVPN providers could use it for unknown purposes or sell it. 
  • Some logging might be necessary to protect against IP blacklisting. dVPN services could allow nodes to keep certain logs and send them to a central repository. It should provide details on whether something tries to find or block the dVPN footprint. 

Therefore, it is crucial to read the full terms of use whenever signing up for any VPN service. Furthermore, a no-logs policy can match the privacy and security offered by reliable decentralized VPNs. Of course, companies need proof of such promises, like independent audits

Examples of a decentralized VPN

A decentralized VPN works as a service that people sign up to contribute to networks or use them. Mysterium network is one of the options, and it is a peer-to-peer decentralized VPN provider. 

You also have options to connect to the Deeper Network services. The latter is unique as it combines physical hardware, Web 3.0, and blockchain. Thus, users need to get a plug-and-play device for their services. It also allows people to earn DPR tokens for their contributions.

A regular VPN vs. dVPN: which is better? 

We applaud introducing new ways for people to become more private and anonymous online. Decentralized VPNs have potential, but it is all about their execution. Like any VPN-like service, it must follow high ethical, security, and reliability standards. 

So, be it regular VPNs or decentralized VPNs, the service providers must be transparent about their activities. You can stumble upon fraudulent or low-quality products in both cases. Luckily, you can reap the benefits of traffic encryption and IP masking if you use a reliable provider. 

Look no further if you are looking for a regular VPN following a no-logs policy. Atlas VPN does not collect users’ original IP addresses or information on their activities. For instance, we cannot tell what specific clients do while browsing the internet connected to our centralized servers. 

Additionally, crypto payments are not uncommon with regular VPNs. Atlas VPN is also one of the providers accepting cryptocurrencies like Bitcoin or Ethereum.

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Anton P.

Anton P.

Former chef and the head of Atlas VPN blog team. He's an experienced cybersecurity expert with a background of technical content writing.

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