VXLAN is an encapsulation protocol that provides data center connectivity using tunneling to stretch Layer 2 connections over an underlying Layer 3 network. In data centers, VXLAN is the most commonly used protocol to create overlay networks that sit on top of the physical network, enabling the use of virtual networks.

https://www.juniper.net/us/en/research-topics/what-is-vxlan.html

https://dmitrygolovach.com/cisco-nx-os-vxlan-configuration/