Residential proxies exploit the reputation of household internet connections to conduct unauthorized activities online, making them attractive to fraudsters who seek to bypass IP-based defenses. Unlike data center proxies, residential proxies appear as genuine traffic from home users, allowing malicious actors to blend in unnoticed. This proxy ecosystem thrives on compromised IoT devices, free VPNs, and apps with hidden SDKs, providing a vast network of residential IPs for sale without the real user's consent. As traditional IP-based trust signals become unreliable, modern defenses must focus on device intelligence to identify fraudulent activity by analyzing technical fingerprints and behavioral patterns that reveal the true nature of the traffic. This approach helps distinguish real users from proxies, offering a nuanced response to potential threats without blocking legitimate customers.