From the Tinc manual:
https://www.tinc-vpn.org/documentation/tinc.conf.5
Mode = router | switch | hub (router)
This option selects the way packets are routed to other daemons.
router In this mode Subnet variables in the host configuration files will be used to form a routing table. Only
unicast packets of routable protocols (IPv4 and IPv6) are supported in this mode.
This is the default mode, and unless you really know you need another mode, don't change it.
switch In this mode the MAC addresses of the packets on the VPN will be used to dynamically create a routing table
just like an Ethernet switch does. Unicast, multicast and broadcast packets of every protocol that runs
over Ethernet are supported in this mode at the cost of frequent broadcast ARP requests and routing table
updates.
This mode is primarily useful if you want to bridge Ethernet segments.
hub This mode is almost the same as the switch mode, but instead every packet will be broadcast to the other
daemons while no routing table is managed.
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Why not use hub mode without all the overhead you may ask?
The Hub and Switch Have Similar Roles
Each serves as a central connection for all of your network equipment and handles a data type known as frames. Frames carry your data. When a frame is received, it is amplified and then transmitted on to the port of the destination PC. The big difference between these two devices is in the method in which frames are being delivered.
In a hub, a frame is passed along or "broadcast" to every one of its ports. It doesn't matter that the frame is only destined for one port. The hub has no way of distinguishing which port a frame should be sent to. Passing it along to every port ensures that it will reach its intended destination. This places a lot of traffic on the network and can lead to poor network response times.
Additionally, a 10/100Mbps hub must share its
bandwidth with each and every one of its ports. So when only one PC is broadcasting, it will have access to the maximum available bandwidth. If, however, multiple PCs are broadcasting, then that bandwidth will need to be divided among all of those systems, which will degrade performance.
A switch, however, keeps a record of the
MAC addresses of all the devices connected to it. With this information, a switch can identify which system is sitting on which port. So when a frame is received, it knows exactly which port to send it to, without significantly increasing network response times. And, unlike a hub, a 10/100Mbps switch will allocate a full 10/100Mbps to each of its ports. So regardless of the number of PCs transmitting, users will always have access to the maximum amount of bandwidth. It's for these reasons a switch is considered to be a much better choice than a hub.
https://www.webopedia.com/DidYouKnow/Hardware_Software/router_switch_hub.asp