Cisco Network Programmability Design and Implementation Specialist (NPDESI) Practice Test 2025 – All-in-One Resource for Exam Success!

Cisco's Virtual Extensible LAN (VXLAN) is primarily associated with multi-tenancy. VXLAN is designed to address the limitations of traditional VLANs, especially in large-scale cloud environments. By encapsulating Ethernet frames in a UDP packet, VXLAN allows for the creation of a large number of isolated Layer 2 segments, or virtual networks, over Layer 3 infrastructure. This capability is crucial for multi-tenancy, where multiple tenants (or customers) operate within the same physical network infrastructure while maintaining their own separate virtual networks.

Multi-tenancy is vital in cloud environments because it enables service providers to offer scalable services to different customers while ensuring that their network traffic remains isolated and secure. VXLAN's ability to support up to 16 million logical networks (compared to the 4096 VLAN limit) makes it an excellent fit for environments where multiple tenants need their own distinct network segments.

In contrast, while Layer 2 VPN and Layer 3 VPN pertain to the methods of connecting remote sites across different types of networks, they do not inherently focus on multi-tenancy. Traffic engineering refers to various techniques used to optimize the flow of traffic in a network but is not a direct characteristic of VXLAN itself. As such, multi-tenancy is