Research summary:
This research report is focused on “Helium” which operates in the IoT industry. We will focus on how the project works, what problems it solves, and review its pros and cons.
The CMP is $21.41 as of 10th September 2021.
What Is an IoT?
IoT stands for Internet of things and in simple terms, it encompasses every device which is connected with the internet. These devices have sensors, software, and the ability to connect and exchange data with other devices and systems over the Internet. For example, an A/C which is connected to your smartphone via the internet could maintain the desired temperature in your home (by switching on and off) by sensing the room temperature. A Smart doorbell is perhaps an IOT that you might have encountered.
IoT has one sole objective, which is to ease the burden on Humans and has applications in the following fields.
- Smart Homes
- Smart Grids
- Smart farming
- Smart healthcare
- Smart cars
What Is Helium?
Amir Haleem, who was once the best player in the game “Quake” and was heavily involved in the gaming industry connected with the Co-founder of Napster (One of the first popular peer-to-peer file-sharing platforms), Shawn Fanning, to start Helium. Helium is a global, distributed network of nodes or hotspots that create public, long-range wireless coverage (similar to a telecom) for LoRaWAN (Long range wide network protocol)-enabled IoT devices. In simple terms, Helium is a decentralized blockchain-powered network for the Internet of Things devices.
It is operational and has 165,761 hotspots globally.
It is currently ranked at #61 (based on Mcap) in the cryptocurrency market. There is a maximum supply of 223 million HNT tokens out of which almost 44% is in circulation. HNT is currently listed on Binance and FTX.
What problems does Helium solve?
Based on Helium’s whitepaper, IoT is expected to be a $1.4 trillion industry with more than 35 billion IoT devices in the year 2021. Now each of these 35 billion devices needs to be connected to the internet to function as an IoT. The purpose behind connecting with the internet is to transfer data packets. The current methods to connect with the internet are Wi-Fi, Cellular, and Bluetooth. These solutions are not efficient as connections via these bridges are often expensive, battery draining, and have a limited range.
For example, a pharmaceutical company wanted to track their patient’s temperature on a real-time basis without any interruption but they could not do it as the IoT device would not always be in the coverage area, not to mention the battery drain for the device.
This is the core problem that Helium aims to solve.
What is the solution and how does it work?
The Helium network is a decentralized wireless network that enables IoT devices anywhere in the world to wirelessly connect to the Internet and geolocate themselves without the need for power-hungry satellite location hardware or expensive cellular plans.
There are 3 important elements in the entire network.
Devices: These devices send and receive data from the internet. The data is fingerprinted and stored in the blockchain.
Miners: The miners are the bridge between the devices and the internet. They provide wireless coverage to the helium network via a device referred to as a hotspot. To become a miner, you need to stake a certain amount of the native token HNT. Miners participate in the Proof-of Coverage process to prove that they are continuously providing wireless network coverage that the Device can use.
Routers: The routers are the final piece of the network. They are the ones who receive the data from the miner.
If you found that slightly complicated, here is a simple version for you. Miners connect to the network using devices called hotspots, which are something like wi-fi routers (Image used above), only they use less power and provide better range. They get paid to take data from connected devices and transport it to its destination through the internet. Let’s say you have a hotspot in your house: if a vial of medicine were to enter your coverage zone, it’s sensors would send its location and temperature data to your hotspot, which would then send it to its proper destination in return for a previously agreed upon cryptocurrency fee. These steps would then be cryptographically verified and recorded in the distributed ledger.
With the Helium network, the monopoly on coverage is eliminated and creates healthy competition amongst the miners.
What is its Tokenomics & the utility of the token?
HNT is the native token in the Helium ecosystem and there was no pre-mine of HNT. HNT is primarily designed to be a reward to all the miners/ hotspot providers for providing network coverage.
“Data Credit” is the only currency accepted to send data over the Helium Network and can be created only via burning HNT tokens. This makes the HNT Tokenomics deflationary.
Who are Helium’s competitors?
Given Helium’s unique nature in the cryptocurrency space, it does not have any major competitors. It however does have competitors in the traditional space, who are also trying to create an IoT network.
Team, media, and community strength
The founders of the Helium network have been experts in their respective fields. Amir was the best player in the popular game “Quake” and was involved in the development of the Battlefield franchise. While Shawn was the co-founder of Napster.com (Which was quite popular). They have attracted an excellent team under them to launch the Helium network.
They are also backed by some marquee venture capital firms such as Google Ventures and Khosla Ventures.
They have excellent community strength, with 80k Twitter followers and 21k Telegram members.
Conclusion
Pros:
Helium is working in the IoT space which is a trillion-dollar industry and aims to solve one of the biggest problems the industry is facing. The Helium network is also growing strongly in the US and Europe. The tokenomics also has a deflationary mechanism.
Cons:
The Helium network however isn’t growing in Asia compared to the rest of the world.
MintingM rating for is Helium 3.8/5
