diff --git a/p2p/kademlia/dht.go b/p2p/kademlia/dht.go
index 3103d0a2..843472f0 100644
--- a/p2p/kademlia/dht.go
+++ b/p2p/kademlia/dht.go
@@ -6,6 +6,7 @@ import (
 	"encoding/hex"
 	"fmt"
 	"math"
+	"os"
 	"sync"
 	"sync/atomic"
 	"time"
@@ -168,15 +169,18 @@ func (s *DHT) NodesLen() int {
 func (s *DHT) getExternalIP() (string, error) {
 	s.mtx.Lock()
 	defer s.mtx.Unlock()
-	// if listen IP is localhost - then return itself
-	if s.ht.self.IP == "127.0.0.1" || s.ht.self.IP == "localhost" || s.ht.self.IP == "0.0.0.0" {
-		return s.ht.self.IP, nil
-	}
 
+	// Return cached value if already determined
 	if s.externalIP != "" {
 		return s.externalIP, nil
 	}
 
+	// Check environment variable to control IP behavior
+	if useExternal := os.Getenv("P2P_USE_EXTERNAL_IP"); useExternal == "false" || useExternal == "0" {
+		s.externalIP = s.ht.self.IP
+		return s.externalIP, nil
+	}
+
 	externalIP, err := utils.GetExternalIPAddress()
 	if err != nil {
 		return "", fmt.Errorf("get external ip addr: %s", err)
diff --git a/tests/integration/p2p/p2p_integration_test.go b/tests/integration/p2p/p2p_integration_test.go
index 267949be..f38e3aa4 100644
--- a/tests/integration/p2p/p2p_integration_test.go
+++ b/tests/integration/p2p/p2p_integration_test.go
@@ -27,6 +27,9 @@ import (
 func TestP2PBasicIntegration(t *testing.T) {
 	log.Println("Starting P2P test...")
 
+	os.Setenv("P2P_USE_EXTERNAL_IP", "false")
+	defer os.Unsetenv("P2P_USE_EXTERNAL_IP")
+
 	snkeyring.InitSDKConfig()
 	conn.RegisterALTSRecordProtocols()
 	defer conn.UnregisterALTSRecordProtocols()
diff --git a/tests/system/e2e_cascade_test.go b/tests/system/e2e_cascade_test.go
index e041e592..851ef28e 100644
--- a/tests/system/e2e_cascade_test.go
+++ b/tests/system/e2e_cascade_test.go
@@ -49,6 +49,8 @@ func TestCascadeE2E(t *testing.T) {
 	// ---------------------------------------
 	os.Setenv("SYSTEM_TEST", "true")
 	defer os.Unsetenv("SYSTEM_TEST")
+	os.Setenv("P2P_USE_EXTERNAL_IP", "false")
+	defer os.Unsetenv("P2P_USE_EXTERNAL_IP")
 	// Test account credentials - these values are consistent across test runs
 	const testMnemonic = "odor kiss switch swarm spell make planet bundle skate ozone path planet exclude butter atom ahead angle royal shuffle door prevent merry alter robust"
 	const expectedAddress = "lumera1em87kgrvgttrkvuamtetyaagjrhnu3vjy44at4"