Proxy vs. VPN: What Is the Difference?

Proxies and VPNs are two of the main tools people consider when online privacy and security become a concern. With growing threats on the internet, both individuals and businesses are looking for ways to encrypt data, maintain anonymity, and safeguard their digital presence.

However, there is often confusion about which tool is better and when to use it. Many users search for answers to questions like, “Is a VPN the same as a proxy?” or “Which should I use for my business?”

This article will explain what proxies and VPNs are, how they work, the main types and use cases, and the key differences in benefits and drawbacks. By the end, you’ll understand when to use a proxy, a VPN connection, or both, depending on your business or individual needs.

For your convenience, we also prepared this tutorial in a video format:

Different proxy types are suited for different purposes:

• Residential proxies are ideal for web scraping and accessing geo-restricted content. Their main advantage is that they mimic real users, reducing the chance of being blocked, but they tend to be slower and more expensive than datacenter proxies.

• Datacenter proxies are best for high-speed tasks like bulk data collection or automated browsing. They are faster and cheaper but easier for websites to detect and block.

• HTTP proxies are great for standard web browsing and lightweight automation, while SOCKS5 proxies can handle more diverse traffic, including email, gaming, and P2P applications.

• Mobile proxies excel at simulating real mobile users or testing mobile apps, though they are generally more costly.

• ISP proxies combine reliability and legitimacy, making them useful for tasks requiring both speed and authenticity.

In general, proxies are used for privacy, network security, bypassing geo-restrictions, web scraping, and performance optimization. Choosing the right type depends on your task, speed needs, and how important anonymity is.

What is a VPN?

A Virtual Private Network (VPN) is an intermediary server that encrypts and transmits data when users connect the internet. VPN is usually used to secure sensitive data and browse the internet anonymously.

Unlike a web proxy, which typically works at the browser or app level, a VPN operates at the system level, meaning all your internet traffic from your device, whether it’s a browser, app, or background service, is encrypted and routed through the VPN server. This hides your real IP address and ensures that anyone monitoring your connection cannot see what you are doing online.

How does a VPN work?

When you connect to a VPN, your device creates a secure connection “tunnel” to the VPN server. All internet data traveling through this tunnel is encrypted, which scrambles the information so that even if someone intercepts it (like on public Wi-Fi), they cannot read it. This encryption protects sensitive data such as passwords, financial transactions, emails, and other personal communications. Once your data reaches the secure server, it is decrypted and sent to its destination. To outside observers, all internet traffic appears to come from the VPN server and not your device, providing privacy and security.

Think of it like sending a letter in a locked, tamper-proof box. Even if someone intercepts the box, they can’t read what’s inside and access user data. And the box is delivered from a neutral location (the VPN server), so the recipient doesn’t know where the letter originally came from.

What is VPN used for?

Using a VPN allows browsing the internet with enhanced privacy levels. Furthermore, it can unlock geo-blocked content and ensures that all internet communication from the user’s device is encrypted.

On a business’s level, the use of a VPN only comes in handy to secure the employees’ devices while being connected to other networks, e.g. WIFI public spaces. However, a business wouldn’t use VPN as proxy to perform web data gathering operations, as it is simply not built for this kind of purpose.

In a nutshell, a VPN will translate your original IP address into a new one, ensuring higher anonymity level as your real IP address is hidden. It will allow accessing geo-blocked content, and perhaps most distinguishing feature in comparison to proxy services is that it will encrypt all the internet request coming out from the user’s device. 

In addition to hiding your IP address and encrypting traffic, VPNs are widely used for security on public Wi-Fi, bypassing censorship, and protecting sensitive transactions. They are useful for both individuals and businesses:

For individuals:

• Protecting sensitive transactions on public Wi-Fi (banking, shopping, email).

• Hiding your IP address for privacy and anonymity online.

• Bypassing geo-restrictions and accessing region-locked content.

• Avoiding censorship and internet surveillance.

For businesses:

• Securing employees’ devices when connecting to external networks or working remotely.

• Encrypting company communications and sensitive data.

• Providing safe access to internal networks for remote staff.

In short, VPNs provide a secure and private connection that safeguards all internet activity while allowing users to access content freely. 

Proxy and VPN: benefits and differences

As you can now understand, a proxy with VPN is often confused because they have a similar purpose. Usually, users do not know what the difference between proxy and VPN is. Let’s take a look at the differences not to raise more questions like “is a VPN a proxy?”

Integration

While both a VPN and a proxy fulfill the same basic purpose, they are created with different goals in mind. Proxies are generally used by and created with businesses in mind, therefore setting them up can be slightly more difficult. Beautiful user interface and overall design are usually secondary to efficiency for proxies.

On the other hand, ease of use is a key concept when VPNs are developed. Since the intended audience is a single individual, making a VPN easy to set up and use is more important when compared to a proxy. VPNs generally require only a few clicks to install and use.

Benefits for the end user

On a regular internet user’s level, using a proxy allows browsing the internet with enhanced privacy levels. Furthermore, if proxy servers are correctly configured then the user’s internet requests can be encrypted, which consequently improves security levels.

What’s more, a proxy can unlock geo-blocked content, even if the user’s real IP address doesn’t have permission to access this particular information. By choosing to operate under a proxy server that is tied to the required geographical location, geo-blocked content will be a worry of the past.

A VPN, like proxy server, will make a user’s internet traffic seem as it is coming from a different IP address. Furthermore, the use of a VPN substantially enhances security levels and allows to access geo-blocked content. However, after that, there are some key differences in the way a VPN works, and how it benefits the end-user.

Unlike a proxy server, a VPN service installed on the user’s device ensures that all outgoing internet traffic (not just the browser, but any app) on the device are processed under the VPN service. On top of that, the VPN creates an encrypted tunnel for all internet communication between the user’s device and remote network. This ensures that in the case of the internet requests being intercepted by unauthorized third parties, it will make it near impossible to decipher the internet request content. Unfortunately, VPNs, unlike a proxy, can cause significant overall slowdowns since all of the web traffic is routed through the server.

Purpose

VPN service is mostly oriented to a single user and is used by individuals who are looking to not only mask their true identity but also to make sure that their internet requests are encrypted.

Whereas a proxy or a proxy server also allows achieving anonymity but is most commonly used by individuals and organizations (in significant quantities) that are performing web scraping operations. If you wish to learn more, our blog on scraping with Python delves into the topic of scraping in a more in-depth way.

On a business’s level, the use of a proxy or a proxy server comes in handy for brand protection, but proxies are also used for market research, web scraping real estate and many more purposes. A common challenge faced by many is to avoid getting blocked by the desirable data source while collecting the required data. The use of a proxy allows overcoming this challenge.

Combining proxies with web scraping allows making it seem as if multiple organic users are visiting the website. And this makes it possible to successfully extract a vast amount of required data without raising any suspicions to the web server.

Proxy vs VPN – quick comparison

There is no clear, all-around winner in the proxy server vs VPN battle. Proxies are often much better for businesses as they are more useful for some traffic-intensive tasks while VPNs will be more than enough for almost any individual.