I am not sure if its needed, don’t know the infrastructure. But an article has been posted earlier about this:
https://www.digitalocean.com/community/questions/private-networking-for-databse-server-or-public-network

Thanks @CrypticDesigns, it sounds like from that post that encryption wouldn’t be needed for confidentiality. I am just curious is they are saying that there is no way for a man-in-the-middle attack via arp poisoning (http://www.shortestpathfirst.net/2010/11/18/man-in-the-middle-mitm-attacks-explained-arp-poisoining/) or a similar attack.

@microleaks From a security standpoint, my answer would be: it depends. If you’re passing data between any network that is confidential and/or private, whether the network is, itself, public or private, and you have customers or clients that depend on and demand that you to keep said data secured, the performance hit is secondary. You should be able to lighten the load by making better use of caching, whether it’s elsewhere in the application, or in a way that you cache the non-private aspects of the data, while bypassing the cache for everything else (i.e. credit card numbers).

Depending on your needs, a 1-2GB instance would be perfect for either Memcached and/or Redis. You could even go as far as using a combination of either with Varnish or similar.

Please vote here for enhanced security:
https://digitalocean.uservoice.com/forums/136585-digitalocean/suggestions/3574245-use-vlans-for-private-networking-between-droplets