What is Helium Network?

What is Helium Network?

By ampersandninja | What is...? | 14 Apr 2021

Launched in July 2019, Helium is a distributed network of long-range wireless hotspots. The goal is to create a blockchain powered network for Internet of Things (IoT) devices creating what they call "The People's Network". The idea of IoT is to have a network that you can connect any device to. It can provide a lot of additional features to a surprising amount of devices. Discussing IoT in particular is outside the scope of the article, but here is a good read on it.

The community run hotspots act as the backbone of the network. Those providing reliable and honest wireless coverage are rewarded with HNT through their new Proof-of-Coverage mechanism. Hotspots are set up through purchasing an appropriate miner from the Helium website. Each one is tested by Helium to ensure they are fully functional on the network. There are a few different ones to choose from, each with different benefits. You can get indoor or outdoor miners, depending on where you would like to keep the device. The average price of a miner sits at around $400.

Rewards can vary based on a few different variables. The biggest one being other miners in range of you. Single miners can only issue challenges and cannot directly participate in Proof-of-Coverage. As a result, they will still earn but at a slower rate than others would. The coverage map offers some extra insight into potential earnings.  


Proof-of-Coverage is a new kind of consensus mechanism created specifically for Helium. PoC verifies that hotspots are representing the location they claim to be. PoC takes advantage of radio frequencies produced by miners to validate them and other participants.

Challenges on the network involve three roles:

Challenger - This is the hotspot that creates and issues the challenge. This occurs about once every 240 blocks.

Transmitter - This is the target of the challenge. It sends out challenge packets and relies on being witnessed by other nodes in close proximity.

Witness - These hotspots are close to the transmitter and confirms the validity of the transmitter's packets.   The roles that a hotspot plays during each epoch defines how much they earn as a reward. This brings me back to the previous mention of single hotspots earning less. Challenging alone earns about 0.95% of the available rewards. Conversely, witnesses can earn up to 21.24%. The actual reward amount can also vary based on how much a hotspot participated in the PoC.

PoC offers a low power way of earning some extra coins while strengthening the network. Most of the hotspots only use about 5W of power, which is already significantly lower than a consumer desktop would use mining a coin. It is worth noting the the initial investment is significant. But the value of the coin sitting at $15 at the time of writing, it could pay off pretty quickly if you're in a good location. A quick look at some hotspots in a higher density areas shows earnings of around 5 HNT a day, which equates to about $70 right now.  

Final Thoughts

The 2021 roadmap for Helium offers a lot of change to the network. Changes to Proof-of-Coverage, addition of validators, updates to the wallet, and a lot of behind the scenes upgrades are all in the works. You can see the full roadmap here. I think the future of it is promising as there is more adoption in the world of IoT in general. There are already quit a few partnerships going on the ecosystem, which will help boost adoption of the network itself. I think there is a lot of good opportunity here and it is worth keeping a close eye on in the future.

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