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I'm using SSH's dynamic port forwarding to host a socks proxy on localhost. I'm trying to find out if the connection between my computer and the remote server/destination is secured. Will my ISP or anyone be able to read data sent through the socks connection?

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"host a socks proxy on localhost"; does that mean you ssh to localhost with dynamic forwarding enabled ? this is useless. – b0fh Oct 14 '12 at 1:32
up vote 1 down vote accepted

The quick answer is No. Data tunneled through your SOCKS proxy will have the same cryptographic strength as much as your SSH session can provide (e.g. RSA-1024, RSA-2048).

Having that said, for the ISP to read your data, in short they'll have to convince you accept a host-key at the beginning of authentication among other things that is not from your remote server, but actually from the ISP. This is why SSH client shows a big fat warning as below to warn you of a possible MITM attack.

Someone could be eavesdropping on you right now (man-in-the-middle attack)!
It is also possible that the RSA host key has just been changed.
The fingerprint for the RSA key sent by the remote host is
Please contact your system administrator.
Add correct host key in /home/peter/.ssh/known_hosts to get rid of this message.
Offending key in /home/peter/.ssh/known_hosts:3
RSA host key for has changed and you have requested strict checking.
Host key verification failed.$
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If the other side can read the data without decrypting it, then so can any middleman.

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