First-class仓 Research Report: Helium (HNT)
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First-class仓 Research Report: Helium (HNT)
Helium aims to incentivize miners to deploy hotspots and provide wireless network coverage, offering low-power, wide-area wireless connectivity for IoT devices, while rewarding miners through its innovative Proof-of-Coverage mechanism.
Navigating Web3 tides with focused insightsHelium aims to incentivize miners to deploy hotspots and provide wireless network coverage, offering low-power, wide-area wireless connectivity for IoT devices. It rewards participants through its innovative Proof of Coverage (PoC) mechanism. Currently, there is no direct competitor in the space, and the project has experienced rapid business growth, remaining on a continuous upward trajectory. Therefore, it warrants attention.
Investment Summary
With the development of the IoT industry, installations of sensors and other IoT devices are growing exponentially. Traditional cellular-based IoT solutions suffer from high power consumption and high costs, creating demand for low-power, wide-area wireless networks.
Helium currently uses the mainstream LoRaWAN long-range wireless technology, which supports a wide range of compatible devices and broad user adoption. As the only product within the blockchain ecosystem providing low-power, wide-area wireless network access, Helium holds a significant competitive advantage in this niche. Combined with blockchain-based incentives, Helium naturally outperforms traditional IoT operators in early-stage equipment deployment costs and expansion speed.
The Helium team is well-structured, having raised approximately $164.8 million in total funding and gained support from several top-tier investors in the industry, ensuring strong financial reserves.
Technically, the Helium ecosystem involves a long technological chain. It began by independently developing and distributing LoRaWAN long-range wireless routers to enable low-power, wide-area connectivity. The core lies in building the Helium public blockchain and integrating technologies like Proof of Coverage (PoC) to establish a decentralized wireless network with effective coverage. The overall technical logic is clear and coherent.
On the ecosystem front, since June 2021, Helium has added more than 30,000 hotspots per month, averaging 1,000 new hotspots daily, with recent months seeing extremely rapid network growth. In terms of business development, Helium is actively integrating with various IoT applications, continuously expanding usage. In the U.S., dozens of enterprises have partnered with Helium, with real-world application scenarios and deployment needs already in place. However, the team has not yet disclosed actual profitability figures.
The economic model is reasonably designed, with HNT being an essential utility token throughout the ecosystem, playing a significant role.
Looking ahead, Helium's most critical next step is deploying a 5G wireless network. A successful launch and adoption would be a major positive catalyst for the entire project. However, we must also consider that 5G base station construction involves enormous costs from investment to commercialization. Additionally, deploying 5G networks entails complex challenges involving 5G carriers, regional policies, operational expenses, and terminal ecosystems.
Overview
Project Introduction
Helium aims to provide low-power, wide-area wireless network access for IoT devices. Through token incentives, it encourages hotspot miners to purchase Hotspot devices (mining hardware in the Helium network), thereby shifting infrastructure costs from the project’s initial phase. These hotspots provide wireless connectivity to nearby IoT devices within their effective coverage area.
Currently, the team is planning to roll out a decentralized 5G network and enable mobile network operators to expand their signal coverage using Helium 5G.
Basic Information
Data source: Coingecko, as of August 25, 2021
Detailed Project Analysis
Team
According to LinkedIn, the Helium team consists of 78 members, headquartered in San Francisco, USA. Key team members are detailed below:
Table 2-1 Helium Team Overview
Overall, the Helium team is reasonably structured, with product design efforts dating back to 2013, aligning well with the current project direction.
Funding
Table 2-2 Helium Funding Details
From Table 2-2 above, Helium has raised approximately $164.8 million in total funding, including investments from top-tier firms such as Multicoin Capital, a16z, and GV (formerly Google Ventures). The team has sufficient capital, with sustainable treasury reserves available for future project needs.
Codebase
Figure 2-1 Heliumcode repository status
As shown in Figure 2-1, Helium has maintained frequent code commits since launch, indicating stable development. Since January 2020, the number of developers has gradually increased, with over 30 core developers consistently contributing to the project.
Products
Overview
Helium is a peer-to-peer wireless network designed to offer secure and cost-effective internet connectivity for low-power IoT devices. Consumers can purchase Hotspots (hardware nodes in the Helium network) to provide signal coverage for nearby IoT devices, participate in network building, and earn tokens.
Helium represents a new business model for deploying and managing wireless networks. Traditionally, telecom companies like AT&T, Verizon, T-Mobile, China Mobile, China Unicom, and SoftBank centrally plan, manage, and deploy wireless networks. They build cell towers, pay labor and logistics, and purchase all equipment upfront before generating any revenue—requiring massive capital and progressing slowly. Unlike these traditional providers focused on 3G/4G/5G, Helium provides connectivity for low-power IoT devices and uses token incentives to encourage users to voluntarily purchase Hotspots, effectively transferring initial deployment costs away from the company.
Product Introduction
Currently, Helium offers four main products, detailed below:
Table 2-3 Helium Product Overview
Hotspot
Helium Hotspot is a LoRaWAN long-range wireless router, similar to a Wi-Fi router.
Users simply plug the Hotspot into power, connect it to Wi-Fi or Ethernet, and deploy it via the Helium wallet. Once synced, the device begins providing wireless coverage and earning HNT tokens. The Hotspot is low-power and supports long-distance data transmission, consuming only about 5 watts at peak, making operating costs very low. Due to these low-power and long-range characteristics, miners can easily join the network, provide wireless coverage, and earn tokens, offering a low-cost, low-power connectivity solution for IoT devices.
Initially developed and distributed by Helium itself, after approval of the HIP-19 proposal, Helium began allowing third-party manufacturers to apply for community approval to produce Hotspots. Currently, eight LoRaWAN Hotspots are supported: Bobcat, Cal-Chip, Kerlink, LongAP, Nebra, RAK Wireless, Sensecap, and Syncrobit. Detailed specifications for each miner can be found at this link.
Figure 2-2 Sample Helium Miners
Console 2.0
Helium Console 2.0 is a web-based device management tool that provides a visual interface for developers and users to register, verify, and manage their devices on the Helium network. Beyond device management, Console offers pre-built integrations, enabling devices to connect directly to cloud-based applications or send data via HTTP or MQTT.
Key features of Helium Console include:
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Organizational structure with tags and user-level permissions.
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Device ID registration, secure login, and authentication.
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Use of Data Credits on the Helium network.
LongFi
LongFi combines the LoRaWAN wireless protocol with the Helium blockchain, enabling any LoRaWAN device—such as GPS trackers, environmental sensors, and weather meters—to transmit data across the Helium network.
LongFi features include:
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Easy deployment: Allows enterprise users to activate any number of devices on-demand without additional configuration or third-party assistance.
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Device roaming: Devices are mapped to blockchain-stored IDs and can relay data through each hotspot across the network.
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HNT token incentives: Device owners earn HNT tokens when helping transmit network data.
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LoRaWAN compatibility: Any LoRaWAN device or sensor can integrate with the Helium network to transmit data.
Helium Tabs
Figure 2-3 Helium Tabs Tracking Device
Helium Tabs is the first end-user tracking device running on the Helium network. Users can track the location of the tag using a mobile app, viewing both current and past locations (supports EU and U.S. frequencies only). The product is nearly sold out, and Lime, a shared scooter company, is already using Helium to track its bicycles.
Technology
Overview
Building a decentralized wireless network, Helium encompasses a long technological stack—from end-user hardware and gateway servers to backend systems and application interfaces—ensuring seamless user access.
Helium initially developed and distributed LoRaWAN long-range wireless routers to achieve low-power, wide-area coverage. It also built a dedicated public blockchain, leveraging its economic model to effectively incentivize network expansion and maintenance. To ensure genuine hotspot coverage, Helium employs a Proof of Coverage (PoC) mechanism: Hotspots submit cryptographic proofs of physical location and uptime to the network, establishing WHIP-compatible wireless coverage. Miners submitting valid proofs are periodically selected into consensus groups, which receive and package transactions from other miners into blocks.
On the payment side, a "dual-token" model combined with OUI (Organizationally Unique Identifier) and state channels enables efficient data transactions. On the application side, iterations from Console to Console 2.0 continue to lower entry barriers.
Helium integrates various technologies from both traditional IoT and blockchain domains. This section focuses on analyzing several key technologies within the Helium network.
Figure 2-4 Helium System Workflow
The data transmission process in the Helium network is illustrated in Figure 2-4 above:
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Users/miners connect to the Helium network via Hotspots.
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IoT devices on Helium securely connect to multiple local gateways within range using the WHIP protocol.
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Once connected, Hotspots send encrypted data to all gateways, which then add the data to Helium blocks.
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Gateways forward designated data to specific routers. After receiving data transmission services, routers pay gateways.
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Routers decrypt the data, completing the process.
Helium Consensus Protocol
The Helium blockchain is an original open-source public chain designed to incentivize the expansion and maintenance of a decentralized physical wireless network.
The Helium consensus protocol draws inspiration from the HoneyBadgerBFT (HBBFT)consensus system, offering resistance to Sybil attacks, high-speed transaction confirmation, and asynchronous, censorship-resistant properties.
Originally, to ensure data validity and authenticity on-chain, Helium randomly selected consensus nodes from all hotspots to form a consensus group verifying each block. However, as the number of hotspots and blocks grew rapidly, this approach impacted block production speed and network efficiency, placing heavy strain on hardware. Thus, Helium redesigned the consensus group formation mechanism by introducing a "validator" role. Now, validators are randomly selected from eligible nodes to perform transaction validation, block production, and receive consensus rewards. Regular hotspots no longer need full node synchronization, improving user experience and resource efficiency.
Figure 2-5 Validator Operation Flow
As shown in Figure 2-5, the validator workflow in the Helium network consists of three main steps: 1) End devices use the Helium network and transmit data to hotspots; 2) Proof of Coverage (PoC) and related device information are forwarded to the consensus group; 3) The consensus group validates transactions, reaches agreement, and produces blocks.
Consensus group composition:
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Users meeting technical requirements can apply to become validators by staking 10,000 HNT (staking more than 10,000 does not increase rewards). There is no upper limit on the number of validators. When a validator unstakes, there is a ~5-month (~250,000 block) unlocking period during which they receive no rewards and cannot transfer or withdraw staked tokens;
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Every Epoch (30 blocks, ~30 minutes), the network randomly selects 40 validators into the consensus group, responsible for validating transactions and producing blocks, receiving consensus rewards at the end of the epoch (6% of total HNT emissions, i.e., 150,000 HNT/month).
Thus, each elected validator earns approximately 2.6 HNT per epoch on average. With over 2,252 active nodes on the Helium blockchain—and growing—the probability of any single node being selected decreases significantly. -
At the end of each epoch, 25% of the current consensus group is rotated out and replaced with an equal number of non-consensus validators.
To ensure validators serve the network effectively, the team implemented a "penalty score" mechanism. Factors such as consecutive re-elections, opposition from majority consensus nodes, or failure to fulfill duties increase a node’s penalty score. Penalty scores do not affect staked HNT principal. Nodes with higher penalty scores have lower chances of being selected into the next consensus group, while those with lower scores have higher selection probabilities. Penalty scores decay over time.
Ordinary users can also choose third-party staking services to delegate their HNT and earn partial consensus rewards (current annual yield below 5%).
Proof of Coverage (PoC)
The Helium network currently supports LoRaWAN-standard IoT devices, aiming to provide open, large-scale global wireless coverage.
A key challenge in building a global decentralized wireless network is how to verify in real-time whether hotspots are genuinely providing wireless coverage from authentic locations, ensuring effective network expansion. To address this, Helium established the Proof of Coverage (PoC) mechanism.
The PoC mechanism leverages Radio Frequency (RF) characteristics to provide meaningful verification for the Helium network and its participants. Specifically, PoC relies on the following RF properties:
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RF propagation has physical distance limitations;
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RF signal strength is inversely proportional to the square of transmission distance;
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RF travels at light speed, resulting in negligible transmission delay.
Using these properties, the Helium blockchain continuously issues "PoC challenges" to hotspots, generating and permanently storing proof-of-coverage records on-chain. Each "challenge" represents an independent PoC verification. To date, the Helium blockchain has issued and processed tens of millions of such challenges, with each new one adding more data about network coverage quality.
Three distinct roles are involved in a PoC challenge:
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Challenger: A hotspot on the Helium network can initiate a challenge to a randomly selected hotspot approximately every 300 blocks (~5 hours), earning HNT rewards. Challengers receive stable income simply by initiating challenges.
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Transmitter (also called Challengee): The challenged hotspot receives the challenge and broadcasts a radio frequency beacon (RF Beacon). Nearby hotspots receiving the beacon act as witnesses, relaying the information back to the Helium network for verification. Only if valid witnesses confirm the transmission does the transmitter earn a reward.
For transmitters, more valid witnesses mean higher rewards. However, once more than four valid witnesses are present, incremental reward gains decrease. -
Witness: A hotspot receiving the beacon becomes a witness, sending challenge data back to the Helium network. During each epoch, the consensus group evaluates whether the witness is valid based on factors including relative positions, cryptographic evidence, signal strength, and attenuation consistency. Valid witnesses receive corresponding rewards.
For witnesses, when the number of valid witnesses per challenge is ≤4, each receives a fixed unit reward. When exceeding 4, the unit reward per witness decreases. Refer to Figure 2-6 below for details:
Figure 2-6 Witness Reward Curve
The community continuously adjusts PoC reward distribution through new HIP proposals, encouraging hotspot operators to optimize deployment strategies and promote healthy infrastructure development.
In simple terms, the PoC mechanism works by having the challenged hotspot broadcast a beacon tied to its physical location. Nearby hotspots (witnesses) use logic based on the transmitted pulse sequence to verify its true position, preventing dishonest hotspots from falsifying their location.
Data Transaction (Packet Purchasing)
Enabling value exchange between wireless data providers and users is central to the Helium network. Data transactions are facilitated through two specific primitives on the Helium blockchain:
1) Organizationally Unique Identifiers (OUI)
An OUI is a registered identity on the Helium blockchain. To send and receive data packets to end devices, network users require an OUI—either their own or one operated by a third party, such as the official Helium Console.
While OUIs have LoRaWAN and packet routing characteristics, what matters for the blockchain is that only libp2p addresses registered as OUI endpoints can open and close state channels on behalf of the OUI.
2) State Channels
State channels are sidechains opened by OUI operators (any libp2p address registered to an OUI). Via a state_channel_open transaction, the operator must stake twice the amount of Data Credits usable within the channel. Additionally, the operator sets the number of blocks before channel expiration.
Once opened, hotspots and OUI operators can conduct transactions within the state channel. Generally, the flow is as follows:
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The hotspot delivers collected data packets to the OUI operator;
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The OUI operator decides whether to purchase the data packet and signs the transaction if so;
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After signing, the data packet is transferred from the hotspot to the OUI operator, who pays the hotspot in Data Credits.
WHIP Wireless Protocol
Several Low-Power Wide-Area Network (LPWAN) technologies are available to enable communication between devices, routers, and gateways. These wireless technologies focus on creating long-range, low-power internet connectivity for sensors and smart devices. However, they trade throughput for distance, with data rates as low as 18 bits per second (bps).
WHIP is a long-range, low-power, narrowband wireless protocol supporting bidirectional communication. It operates in sub-GHz unlicensed bands (frequencies below 1 GHz, ranging from 27 MHz to 960 MHz), widely used in consumer electronics, automotive, industrial, and medical applications, offering advantages in low power, long-distance communication, and wall penetration. Identity authentication uses NIST P-256 ECC key pairs and public keys stored on the blockchain to ensure secure communication.
Additionally, the WHIP protocol creates multiple channels within unlicensed bands and uses frequency hopping to switch between them. Typical frequency hopping requires a complex time-synchronization system and has limited capacity. However, because hotspots can listen to all available spectrum channels at any time, WHIP-enabled devices do not need to coordinate channel selection with hotspots, enabling higher data transmission rates and reliable operation in noisy RF environments.
Summary: The Helium team is well-structured, with approximately $164.8 million in total funding and sustainable treasury reserves for future development. Technically, the Helium ecosystem spans a long technological chain, with clear overall logic, primarily relying on the Helium public blockchain and technologies like Proof of Coverage (PoC) to build and maintain a decentralized wireless network with effective coverage.
Moreover, the project maintains active development progress and has achieved product launches with real-world applications.
Development
History
Table 3-1 Major Events in Helium History
Current Status
Helium Ecosystem Data
Figure 3-1 Helium Network Hotspot Coverage
As shown in Figure 3-1, the Helium network currently has 130,897 hotspots, concentrated mainly in the U.S., Europe, and China. Since June 2021, the network has grown by over 30,000 hotspots per month, averaging 1,000 new hotspots daily, with exceptionally rapid growth in recent months.
As of August 18, 2021, Helium hotspots covered 12,773 cities across 116 countries, with 41,570 hotspot owners and an 82.90% online rate.
Clearly, Helium Hotspots have achieved a certain scale globally. However, rapid increases in hotspot numbers alone do not indicate project success. A comprehensive assessment must include ecosystem usage, real participant engagement, and actual business volume. To better illustrate Helium’s current ecosystem status, TechFlow compiled the following overview based on publicly disclosed team data:
Table 3-2 Helium Ecosystem Overview
As shown in Table 3-2, Helium has diverse application scenarios, including pet tracking, air quality monitoring, food traceability, and GPS positioning. For example, in some international regions where courier logistics are less convenient and lost packages are common, GPS tracking for high-value shipments presents a genuine use case.
Hotspots are largely sold out in the market, with secondary-market prices significantly inflated, reflecting strong supply-demand imbalance.
However, due to policy restrictions, Helium hotspots have little market presence in China. Most hotspots deployed in China are idle, solely mining HNT tokens for rewards.
Hotspot Mining Yield
It should also be noted that one of the primary drivers behind Helium’s rapid ecosystem growth is its token reward system.
Currently, Helium releases 2.5 million HNT monthly, with 35% allocated to hotspot infrastructure rewards, divided among participation, witnessing, and creating PoC challenges. That means 875,000 HNT per month are distributed to hotspots. With approximately 130,000 active hotspots, the average monthly reward per hotspot is roughly 6.73 HNT (this is a simplified average, not reflective of actual uneven distribution).
Assuming a $500 hotspot cost and an HNT price of $19 (ignoring electricity costs), the breakeven period is approximately 4 months.
This is a rough estimate. In reality, ordering a hotspot from the official site currently takes about 4.5 months (estimated, varies by region). Additionally, the 35% allocation for hotspot infrastructure is further subdivided into participation, witnessing, and challenge creation. Therefore, users purchasing a single hotspot will likely earn far less than the estimated 6.73 HNT/month average.
Note: Regional differences mean we do not consider the 30% of monthly HNT emissions allocated to network data transmission rewards here.
Based on TechFlow’s random sampling of over 200 hotspots on Helium Explorer:
Table 3-3 Random Hotspot Sampling Results
Note: Sampling results as of August 20, 2021. Due to small sample size, there may be discrepancies with actual conditions. For reference only.
Combining real-world observations and Table 3-3, we see that isolated hotspots in areas like Xiamen Island or Taipei averaged around 1 HNT in earnings over the past 30 days. In denser areas like Wenzhou and Shanghai, average monthly earnings exceeded 20 HNT. In cities with near-complete coverage—such as San Francisco (the team’s HQ) and Amsterdam—earnings also consistently surpassed 20 HNT per month.
Our sampling revealed significant variance in monthly yields even in densely covered areas, with some hotspots earning under 1 HNT and others over 100 HNT per month.
The data clearly shows a positive correlation between physical hotspot density and earnings. Higher hotspot density leads to greater average earnings, primarily because neighboring hotspots can witness each other’s activity and earn PoC rewards.
Smart deployers often cluster hotspots in dense geographic areas or install multiple units simultaneously. By enabling mutual witnessing among devices, they boost earnings. Additionally, hotspot performance depends on terrain openness, installation height, antenna signal strength, and whether local Helium-based applications generate real data traffic. Actual optimization requires hotspot owners to experiment and adjust based on their specific environment. Interested users can refer to official tutorials on Helium’s YouTube channel for guidance
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