If I am correct, proxies access the server you want to connect to for you, therefore hiding your IP address (most of the time).

If I want to escape from my ISP spying on me, wouldn't hosting my own proxy server be useless, because that proxy server uses my ISP to connect to the server I want to connect to?

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    Yes; if your goal is to stop your ISP from viewing your communications then you need to host the proxy outside your ISP (Amazon AWS, Microsoft Azure, etc are options, but then they can see what you're browsing to). If you're doing something very sensitive and don't want to be traced, go to a coffee shop some distance from your home and run Tails. – Robert Fraser Aug 11 '16 at 6:50
  • I use Tor for stuff I don't want my ISP seeing (yes it's 100% legal). However the speed of Tor is a downside. I also don't like how Google always asks me to complete a Captcha, and every f*cking website is in french. – jadenPete Aug 11 '16 at 6:51
  • HTTPS also provides a HUGE advantage because although my ISP can see the server and the url, data between me and the server is encrypted, and if my ISP tries to intercept it, they will just get random encrypted garbage data. – jadenPete Aug 11 '16 at 6:53
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    Then you need a proxy outside your network. Free public proxies aren't going to be any faster than Tor, so you can host a proxy in the cloud, buy a $5/month proxy service, set up a friend's computer as a proxy, etc. – Robert Fraser Aug 11 '16 at 6:55
  • Creating your own isn't useless. Hosting it at your house and using the same ISP defeats your purpose. @RobertFraser I'd recommend posting your comments as an answer. – schroeder Aug 11 '16 at 7:09

In the absence of a remote proxy your ISP has visibility of

  1. all the dns records you attempt to lookup,
  2. your connections to remote sites and
  3. the data you exchange with those sites over non-encrypted channels.

Using a remote proxy (depending on how it is configured) addresses the first two of these. If you add an encrypted VPN link between you and the remote proxy then you resolve the last. Your ISP can only see data flowing between you and the proxy - not what it contains.

Note, setting up a server constantly exposed to the internet, with at least partially open ports is a different league in terms of security than connecting to the internet from home via an ISP (and probably a masquerading router).

However, all the above information is then exposed where the proxy is hosted - you've only shifted the visibility somewhere else.

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