I was looking at wrong value from start. I found out it’s only displaying TCP in protocol but in background the data is encrypted via mTLS.
To verify it i have first set MODE=PERMISSIVE and sent some curl request too app2.istio service within istio meshed and non-meshed namespace.
From non-istio-meshed namespace:
curl app2.istio/asd
From istio-meshed namespace:
curl app2.istio/asd
