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A VPN masks your IP address by redirecting it through a specially configured remote server run by the VPN host. So, when you browse online using a VPN, the VPN server becomes the origin of your data. This makes it impossible for your ISP or any other third-parties to see what websites you are visiting or what information you are entering. A VPN works like a filter that turns all the data you are sending and receiving into gibberish. Even if someone did get their hands on this data, it would be useless.

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