They do admit that you IP address is collected when you start using the service and that they automatically log general information about your general location to “improve the service or optimize advertisement”. Regarding the data logged, Hotspot Shield states in its privacy policy that it doesn’t store logs that would associate your IP address with your online activities while using the service. Their paid service also offers an ad-free browsing experience and malware protection.
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That being said, as per the support service, their Windows client features OpenVPN with 256-bit AES encryption. The website doesn’t offer clear information about the protocols used, which is not a good sign for users who are looking for top protection for their online privacy. Some relevant details about the service and the level of security and privacy that Hotspot Shield provides are not explained. The downside is that this simplicity becomes an issue as they fail to clarify some important technical information.
Hotspot Shield is designed to offer convenience and to make things easy for VPN users, particularly those who are new to this technology and who are not familiar with all the elements that it involves.