How secure is the connection between droplet and my computer?

How secure is the connection between droplet and my computer?

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That depends on what kind of connection you are making.

When connecting via SSH or SFTP all communications is encrypted.

When using http all communications is in the clear.

When using https the connection request is in the clear but the data being transferred is encrypted.

The connection between your droplet and your local computer is as secure as you make it and as secure as the software you choose to run on your droplet allows.