What is Helium (HNT)?
What is Helium (HNT)?
Helium is a decentralized blockchain powered network for Internet of Things (IoT) devices that use nodes for hotspots to link wireless devices to its network. The network is powered by the Helium Network Token (HNT), its native token. HNT serves as a reward when Hotspots transfer connection data through the Helium network.
Nodes on the Helium network are owned and operated by people in their homes or workplaces, and these individuals get rewards for participating in the network via payouts in HNT.
Who is the Founder?
The Helium network was co-founded by Shawn Fanning, Sean Carey, and Amir Haleem in 2013. Helium was founded to make it simpler to develop connected devices. The Helium project generated more than $53 million in 4 different funding rounds between 2015 to 2019. And in 2019, the network went live.
How does Helium Network Token Work?
The objective of the Helium network is to create a global decentralized blockchain powered network for IoT devices that are dependent on the HNT holder community.
The network also seeks to solve the problem of WiFi’s support for Internet of Things (IoT) devices, which is the privacy concerns that come with hosting as many devices as possible. To do this, Helium uses a decentralized architecture and consensus mechanism called Proof of Coverage that enables the network to have 200 times more coverage in comparison to WiFi connection with the IoT.
Helium is made up of nodes, which are hotspots managed by node operators. These node operators are HNT holders. In exchange, for managing nodes and hosting hotspots users are rewarded in HNT as their activities aid the network’s functionality.
The Proof of Coverage consensus mechanism that the Helium network runs on is responsible for distributing rewards to node operators and HNT holders.
Helium network users must purchase a blockchain mining device from the blockchain’s website to set up Hotspots. Radio frequencies are then produced by miners connecting to the network. Simultaneously, the proof of coverage algorithms validates Hotspot locations.
Participants of the Helium network can occupy one of the following roles vital to the blockchain’s functionality; Messenger, Transmitter, or Challenger. The incentives distributed via the system are also dependent on their role in the Hotspot network.
Key Features of Helium
Proof of Coverage
The Helium ecosystem is powered by Proof of Coverage. Proof of Coverage is an updated Proof of Work model created specifically for the Helium network. It uses radio frequency waves to check if hotspots are providing legitimate wireless coverage.
The Proof of Coverage algorithm is combined with the Honey Badger Byzantine fault tolerance protocol. This enables the network nodes to reach consensus even when there are certain node failures or when connection rates vary.
The mechanism is secured by a challenge. The challenge is solved by 4 roles interacting within the Helium network. These 4 roles are:
- Challenger: The challenger initiates the challenge and ensures that the hotspots are providing wireless coverage through the RF network in a particular location.
- Witness: These are the surrounding hotspots that report the activity of the Proof of Coverage to the Challenger.
- Beacon: This is also known as the challengee or Beaconer. It transmits the data package to hotspots nearby.
- Validator Challengers: This is a new role that was developed as the Helium blockchain evolved. These are validator nodes that verify block transactions and the addition of new blocks into the chain. Validators can also issue a challenge. Participants need to stake 10, 000 HNT for them to run a validator.
All the participants in the challenge are rewarded with HNT once the network data transfer and Proof of Coverage are completed.
Which Blockchain does Helium Network Token Use?
The Helium Network Token uses a native blockchain called the Helium Blockchain. The team built the blockchain from scratch to incentivize the creation of a public, decentralized wireless network. It is also based on the Proof of Coverage algorithm, a novel consensus, and rewards miners in HNT, its native token.
How to Use Helium (HNT)?
Helium Native Token is the token that powers the Helium network. It is earned when Hotspots provide and validate wireless coverage and also transfer device data over the Helium network.
The Helium Native Token is designed to be used by the following players in the Helium ecosystem: Hotspot hosts and Network Operators and enterprise and developers who use Helium to connect devices and build Internet of Things (IoT ) applications.
HNT is used to pay transaction fees for wireless data transmissions on the Helium Network. HNT can also be sold in the crypto market or used to generate non-exchangeable Data Credits. Helium users can even stake HNT on the platform and earn staking rewards.
How to Buy Helium (HNT)?
Helium Native Token (HNT) is available on various popular exchanges. The process of buying this token is simple. But first, you need to choose the right crypto exchange to use for the transaction. The fastest way to find where you can buy HNT is CoinMarketCap.com. There, you will see a list of exchanges that support HNT and how to easily make the purchase.
After choosing the right exchange for you, you will need to register and log in to your profile on the exchange to make a purchase.
The process of buying HNT on most exchanges is similar. There may be a slight difference in the documents required for registration on each exchange but after that, the steps to buying HNT are pretty much the same across exchanges. Below is what the process is like on most exchanges:
- Register on your preferred exchange.
- Go to the “Buy Crypto” section and choose your preferred fiat currency.
- Use the fiat currency to HNT. If you decide to buy HNT with another cryptocurrency, you will need to use the fiat currency to buy a stablecoin like USDT.
- Once you have the USDT, you can buy HNT with it.
How to Store Helium Network Token (HNT)?
Helium Network Token can be stored on both software and hardware wallets. While there are various wallet options to choose from, it is recommended that you store HNT on its native wallet.
On the Helium website, there are 3 wallets recommended for the storage of HNT. Let’s take a look at each of them.
Helium Wallet App
The Helium Wallet App is the best wallet for the storage of HNT. The wallet app was designed to manage the network participants’ tokens and identities in the Helium ecosystem. The app has pairing and Hotspot setups and it is available on both iOS and Android operating systems.
The Helium Wallet App has multiple account support as well as multiple recipient payment support. Other features include an Address book, Ledger Balance, Helium Vote, and the verification of the network participants identity.
All new wallets created with the Helium Wallet App are generated with a 24-word seed phrase. This seed phrase must be imputed in the correct order for users to access their wallets. The seed phrase is not stored anywhere on the Helium Network so if a user loses his 24-word seed phrase, it cannot be recovered. This means that access to his Helium Wallet will be lost.
Considering how important the seed phrase is, Helium users are advised against sharing their seed phrase with anyone. Taking screenshots of the seed phrase is also discouraged. This is because anyone who has the seed phrase can easily access the user’s account and steal their funds. Also, whoever has the seed phrase is considered to be the owner of not only the tokens in the wallet but also the validators and hotspots.
Helium Command Line Interface Wallet
The Helium Command Line Interface Wallet is another wallet recommended by the Helium team for the storage of HNT. The Command Line wallet is more flexible than the wallet app because asides from the storage of HNT, it supports all types of transactions. But it is also more advanced, it is best for tech-savvy users. The Helium Wallet App is best for beginners.
Installing the Helium CLI wallet is easy. Releases of the Helium CLI wallet are hosted on Github. Once you are there, you need to click on the “Download” icon and select the right package for your operating system. There may be a slight difference in the installation steps for the different operating systems.
The Helium blockchain supports the storage of HNT on Ledger hardware wallets. Hardware wallets are the safest option for the storage of cryptocurrencies and digital tokens. They are less susceptible to hacking attacks.
The Helium Ledger Wallet application is a Helium application that runs on the Ledger Hardware wallet. Users can only send and receive HNT on the wallet, no other transactions are supported.
The Helium Ledger wallet can be installed on both the Nano S and Nano X models of Ledger Wallet. With the Ledger wallet, Helium users can view their Helium addresses and balances, submit validator transactions, and issue payments to one address.
Best Place to Stake Helium Network Token
The best place to stake the Helium Network Token (HNT) is at https://www.helium.com/stake. Here’s a screenshot of the estimated APR vs Total HNT staked in millions:
What You Need to Know about the Future of Helium Network Token
Currently, the Helium Network is operational in numerous cities around the globe, and the team behind the platform has huge plans to grow its network coverage. As the network’s adoption rises, the Helium Network Token’s demand is expected to rise alongside it.
While the HNT price predictions from various sources differ, most analysts predict that HNT will soon become one of the top 10 digital currencies by market cap with an average price of over $200 by 2030. However, due to the volatility of crypto assets, it’s difficult to accurately predict the future price of a digital currency, but HNT’s strong fundamentals and the Helium Network’s widespread adoption can make it a top coin in years to come.
Conclusion: Should You Put Your Money in Helium Network Token?
HNT is the native cryptocurrency of the Helium Network. This means that the success of the token is entirely dependent on the widespread adoption of the network. So before putting your money into HNT, you need to understand the objective of the Helium Network and decide if you believe that the project would succeed in the long run.
Risk in Investing in HNT
As with any other cryptocurrency, HNT is extremely volatile. This means that there’s a probability that you can lose your money investing in HNT. So ensure you do your due diligence before investing in the token.
Our extensive analysis of the different Cryptocurrencies doesn’t stop here. You can also check out our “What is Gnosis?” guide to know more about another huge project.
Most frequent questions and answers
When considering whether Helium mining is worth it, consider the rewards and risks. HNT token mining is a great way to generate a passive income that grows slowly with time and becomes more valuable as one mines helium’s native token for extended periods. So in the long run you can reap the rewards of buying a Helium miner.
The daily network mining average is about 0.11 HNT per day.
The Helium Network offers various security measures to make crypto mining on its blockchain safe. Here are a couple of measures:
Helium-enabled LoRaWAN devices are hardware secured to safeguard the traffic from the used spectrum, which means the security is in-built as devices utilizing the network possess AES private key encryption at the chip level.
The typical attack vector to hack into the Hotspot is inbound ports. However, the Helium hotspot only needs one port open in 2 directions – TCP Port 44158. This means other inbound ports can be secured behind a firewall.
The Helium Network has no annual fees and you just have to pay for your data usage. That said, every 24 bytes transferred in an uplink packet cost 1 DC = $. 00001. However, ACKs and Downlinks do not need Data Credits.
The Proof of Coverage protocol keeps the Helium Network secured.
To acquire data credits, Helium users can convert HNT or get them from another HNT user.
A wireless gateway is a device that enables a computer and other internet enabled devices to access shared wireless connection. The wireless gateway, can be a hardware, a software or both.
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