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If you’re using iCloud or auto-join to connect, initial handshake is through bluetooth but the actual connection is via wi-fi.
 
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Considering Bluetooth is painfully slow for transmitting more than a few bytes of data at a time, you can be sure it is using something else for the actual connection.
 
Considering Bluetooth is painfully slow for transmitting more than a few bytes of data at a time, you can be sure it is using something else for the actual connection.

It is easy to prove that the actual connection is via WiFi. If you try to switch WiFi off and then back on using the Control Centre, it will warn you that this will end all hotspot connections if these are currently active.
 

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Considering Bluetooth is painfully slow for transmitting more than a few bytes of data at a time, you can be sure it is using something else for the actual connection.

Iirc, I used bluetooth for tethering to my iPhone 4 (lower battery usage) and I was pretty much getting the same speeds on the tethered device (~5 Mbps). It won’t stream 4K but it’s good enough for web browsing, 720p YouTube, music, etc.
 
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