What is the function of a VTEP in VXLAN?

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What is the function of a VTEP in VXLAN?
A . provide the routing underlay and overlay for VXLAN headers
B . dynamically discover the location of end hosts in a VXLAN fabric
C . encapsulate and de-encapsulate traffic into and out of the VXLAN fabric
D . statically point to end host locations of the VXLAN fabric

Answer: C