Imagine a physical address in the postal system. You have a home address that you share with your family, and send letters to other people with other addresses. IP addresses are the same, each router has its own (your ISP provides you with one, usually) and you can connect to (almost) any other IP on the internet.
IPs aren’t really sensitive only by themselves, though they can be used to track people accross a website. For example, if you visit my website and I see 8 requests in the span of a few minutes, I’ll know they were from the same visitor. I could also use some services that provide IP geolocation (estimate) that could tell me which internet provider you have and the city were you’re in.
What common “VPN” services do to “protect you” is acting as an intermediate: you send all your correspondence to the VPN server via a secure tunnel and they send it to its real destinations. The other end sees the message coming from the VPN’s IP address and not yours, so they can’t see your actual address.
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