Data security and data privacy are two interrelated but different things. Security is about protecting sensitive information from people who want to steal it. Privacy is about making sure no one sees anything they shouldn’t. If you think about your house, security is locking your doors to keep people out, while privacy is closing the curtains to keep people from watching you eat dinner.

If you’re trying to decide between a proxy server or virtual private network (VPN) service, you’re really making a decision between privacy and security. Your proxy server can hide your identity, but your VPN encrypts data, giving you better security.

Understanding the similarities and differences between proxy servers and VPNs can help you make a decision that fits your needs. Let’s walk through the differences between proxy servers vs. VPNs and figure out which one is best for you.

What is a proxy?

A proxy server hides your IP address by rerouting the requests your computer sends to applications. Your IP address uniquely identifies your location on the internet, similar to how your home address uniquely identifies your physical location. You can think of a proxy server like a post office box where an intermediary becomes the point of contact but doesn’t change your IP address.

Typically, when your computer connects with a website, the following happens:

1. Computer sends a request.
2. Application reads the request.
3. Application sends back the data that your computer asked for.

When you use a proxy server, it adds two additional steps that we’ve bolded here:

1. Computer sends a request.
2. Request travels through the proxy server.
3. Application reads the request.
4. Application sends back the data to the proxy server.
5. Proxy server forwards that data to your computer.

What are proxy servers used for?

Typically, people and businesses use proxy servers to:

• Access geographically restricted websites, like streaming shows only distributed in a certain country, or to get around internet censorship.
• Block sensitive content, like social media or malicious applications.
• Hide their location from advertisers.

Types of proxies

The three most common types of proxies are:

• Socket Secure (SOCKS) 5: A SOCKS5 proxy hides your IP address but won’t encrypt your data. While it can get you around blocked content, it likely won’t get you past national firewalls. But since SOCKS5 tends to be faster than other proxies, it’s ideal for P2P sharing.
• HTTP: An HTTP proxy acts like a content filter by checking network traffic for suspicious content that could be malware or an intrusion. HTTP proxies can also help you hide your identity and access blocked websites.
• Transparent: A transparent proxy, also called a forced proxy, can be installed without your knowledge by your internet provider or a website owner. Typically, this type of proxy is used to filter or censor content — or require authentication before a user can access content.

What is a VPN?

A VPN service hides your IP address and creates an encrypted data tunnel. The encryption scrambles your data so malicious actors won’t be able to understand it even if they manage to intercept it during transmission.

What are VPNs used for?

VPNs can be used for the same reasons as a proxy, but they have additional uses as well:

• Unblock geo-restricted websites and streaming services or get around internet censorship.
• Block sensitive content, like social media or malicious applications.
• Hide a user's location and browsing data from advertisers, websites, and their internet service provider (ISP).
• Securely access remote servers, such as workstations while working remotely.
• Protect data sent over unsecure networks, like public Wi-Fi.

Types of VPN protocols and encryption

While VPNs may all look the same at first glance, they come with a few different protocol and encryption settings that could make some services more secure than others. A good VPN service uses one or more of the following:

• AES-256 or ChaCha20 encryption
• WireGuard, OpenVPN, or IKEv2 protocol

All of our recommended best VPN services offer these security settings as well as additional features to help protect your data.

What are the similarities between proxies and VPNs?

Many people confuse proxies and VPNs because they do share common qualities. Basically, both enable you to:

• Hide your IP address
• Access streaming and gaming services anonymously
• Bypass geographic restrictions

Finally, both services slow down your connection speed for the same reason: By anonymizing your IP address they add another stop for your data as it travels across the internet.

What’s the difference between proxies and VPNs?

Since proxies and VPNs work differently, you should understand what you’re really getting with both so that you can make the choice that best helps you protect yourself and your data.

Encryption

From a data security and privacy perspective, encryption is the primary difference between the two services. A proxy server reroutes your traffic, but it doesn’t really do anything else to protect it. Malicious actors can still compromise data through:

• Eavesdropping on your data as it travels between your device and the service
• Gaining access to the proxy server and interrupting the connection

VPNs create an encrypted tunnel between your device and the network, making all data sent across that secure connection unusable without the required decryption key. By encrypting the data in transit, VPNs fix the proxy servers’ two biggest security and privacy issues.

Pricing

The flip side of the “better security and privacy” coin is most people end up using a paid VPN. Although you can find free VPN services, many of them come with drawbacks like:

• Limited amount of data to use per day or month
• Slower connection speeds
• Fewer servers to connect to
• Restrictions on how many devices you can connect to the VPN
• Collection of your data to sell for profit
• Fewer customer support options (or slower support responses)

Meanwhile, most proxy servers are free. If all you want to do is bypass a geographic restriction and not encrypt your data, then the proxies will meet your expectations.

Online privacy

When you’re thinking about the difference in costs, you also need to look at the terms and conditions for each service. Many free proxy servers sell your data to advertisers, meaning that you lose control over who has access to your information.

While free VPN services may also do this, some offer “no log” policies — meaning they don’t store your online activity. If they’re not storing it, they can’t sell it.

If paying for a VPN is out of the question, keep in mind that some free VPN services are more trustworthy than others. Check out our list of the best free VPNs to find out which ones have the fewest restrictions and data privacy concerns.

Configuration

When you set up your proxy server, you need to configure it on a per-application basis. If you forget to include the application in your configuration list, then you don’t get the protection you wanted.

Again, since VPNs encrypt all your data, they provide extended privacy coverage without requiring a lot of special configurations. Most VPNs allow you to install the app on your device, then click a button to connect to a VPN server to quickly encrypt your data.

Internet speed

Although both proxy servers and VPNs slow down your internet connection speed, you should understand how they work differently and how that impacts relative speed.

A lot of people all at once may end up using the same proxy server, especially if it’s a free one. All those people trying to use the same resource can clog up the connection and make everything run slower.

With paid VPN services, you can often choose a server in your geographic region. The closer the server, the less time it takes for the requests and responses. Further, when you’re paying for the service, the provider often maintains the technology and protocols better so you may not even notice the delays.

Are proxies or VPNs better?

The unpopular answer here is: it depends. Depending on how you want to use the service, a proxy server might be better than a VPN, or vice versa. However, you should choose one or the other rather than investing in both because if they’re working at the same time, your connectivity speed will suffer.

Is a proxy right for you?

A proxy server is a better decision if you want to:

• Hide your IP address from one or two locations
• Save money
• Control internet access, like preventing children from accessing sensitive content
• Access geo-blocked content

However, a proxy server might not work well for you if:

• You don’t trust other people with access to the proxy server’s data
• The existing local network isn’t compatible with it
• You don’t want to pay the setup and maintenance costs

Is a VPN right for you?

A VPN is a better decision if you want to:

• Use encryption to secure data
• Protect your identity
• Access geo-blocked content
• Avoid bandwidth throttling by your ISP

However, a VPN might not work well for you if:

• You use it as your only security protection — you should also use antivirus software.
• You need continuous, predictable performance.
• You need reliable availability.
• You have a limited budget.

What’s the best, a proxy or a VPN?

Choosing between a proxy and VPN provider depends on your use case. However, once you decide which technology suits your needs best, you still need to decide which service provider you want to use.

Best proxies

Since most VPNs also include proxy server capabilities, you might struggle to find the best free proxy on the market. However, the following three give you exactly what you need at your favorite price — “free ninety-nine”:

• HMA: Browse privately and unblock websites by selecting one of six global servers right inside your usual web browser.
• KProxy: Choose from 10 servers or download the KProxy extension for Chrome, Firefox, and Edge browsers.
• ProxySite: Choose from 38 servers across the U.S. and Europe, then connect to the website you want to unblock or bypass content filters on popular social media sites like YouTube, Facebook, and Reddit.

Best VPNs

If you want the encryption and security that setting up a VPN offers, then these three paid services gives you exactly what you need:

• ExpressVPN: While it can be expensive, ExpressVPN offers secure 10 Gbps servers in 94 countries across the Americas, Europe, Asia-Pacific, and Middle East and Africa and is compatible with Macs, PCs, iPhone, Android, routers, multiple browsers, and even smart TVs.
• NordVPN: Offering over 5,000 servers in 60 countries, NordVPN lets you choose from various server types, including double VPN, Onion over VPN, obfuscated, dedicated IP, and P2P servers.
• Surfshark: One of the least expensive secure VPNs, Surfshark has servers in over 100 countries and also offers unlimited device connections, an ad blocker, split tunneling through its Bypasser feature, and a kill switch.

Proxy FAQ

Bottom line

When trying to make data protection decisions for yourself and your family, knowing is more than half the battle.

If you want data security and privacy protections, paying for an encrypted VPN service makes the most sense. If you’re mostly interested in streaming your favorite television show that’s only available in a different country, then a proxy makes more sense.

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Author Details

Karen Walsh

About the Author

Karen Walsh is a lawyer and former-internal-auditor-turned-subject-matter-expert in cybersecurity and privacy compliance. Karen has been published by leading industry outlets and quoted by The New York Times and CNN Investigative reporters.