Helium – The People’s Wireless Network
Helium is a global, distributed network of long-range wireless coverage hotspots for Internet of Things (IoT) devices, powered by the Helium blockchain. Community run hotspots create ‘The People’s Network’ and they are rewarded with $HNT, the native cryptocurrency of the network, through the Proof-of-Coverage mechanism. Helium has managed to build the largest P2P network with over 600,000 hotspots and is now starting to deploy other networks like a 5g cellular network.
We were joined by Founder and CEO of Helium, Amir Haleem, to chat about how Helium works and the most interesting use cases, how the Proof-of-Coverage mechanism allows the community to participate, and the road ahead for the network.
Topics discussed in the episode
- What is a wireless network and what makes them so interesting
- The objective of Helium
- The use cases Amir is most interested in
- How cellular networks are utilized
- Helium and censorship resistance
- The architecture of the Helium Network
- The HNT and Data Credit tokens
- The possibility of Helium becoming interoperable and hosting smart contracts
- The biggest challenges in Helium’s future
Brian: About Helium so, I’ve been listening to some podcasts with you and learning a little bit about Helium and I think there’s so much that’s fascinating there to dive in, but also I don’t understand this and would love to maybe dive in.
What’s a wireless network? And why are your wireless networks interesting?
Amir: Good question, Helium is sort of an odd one in the crypto space, compared to others, because we are doing this sort of physical world thing. We’re not the only one, but certainly, one of only very few, the mission for Helium started way before our crypto adventure.
We started the company to try and build a big sensor network, we wanted people to be able to connect sensors to the internet and do it cheaply and not have to pay for cell phone plans and be able to run on batteries and, the kind of stuff that people describe as the internet of things (IoT).
And that was sort of the mission objective of the company, and it took us a few years of trying different approaches before we ended up realizing that sort of decentralizing the building of the network was probably the best way to make that happen you want to build this sort of global scale very ubiquitous thing.
And this sort of the traditional approach is to spend many billions of dollars doing that, which is what you see from a traditional telecom, whether it’s AT&T or Vodafone or Orange or whatever. And then the new approach, which Helium is sort of pioneered here is don’t own the network.
Let the people build the network and participate in the economics of it. And that’s sort of the approach that we started down in 2017 and it’s kind of where we are today.
Brian: Now I would love to maybe stay a little bit on the, even the prior question. So you’re saying, an IoT network, right?
A network for these sensors to connect with, why are there particular, use cases, or is there a particular scenario that you want to see established where this is crucial? or did you just think it was a big underserved market or what’s kind of, that makes that problem so interesting?
Amir: I think both, at the time that we started the company, I sort of mentioned this on another podcast, last week, but we happened to have a bunch of entrepreneurs, friends that were building connected hardware products, and that was a big part of the Genesis of the company was that these guys had very specific problems that they were looking to solve.
One guy was building, a connected baby monitors as a baby bracelet, and one guy was building a people counter and, and so those are the kinds of applications where you want to connect to the internet, but it has to be small and it has to be battery powered and it has to be cheap and there’s, hundreds or thousands or millions, even applications that we’ve sort of discovered over the years that are interesting, that are possible to serve.
Some of them are obvious, package tracking at a granular level, if I wanted to know specifically where a package is, not just what truck it’s on, you need kind of a throwaway, type sensor, it has to be ultra cheap and ultra-small and run on a coin cell battery or something that.
And then, it goes all the way through to, wildfire sensors, where I live up here in the north bay area we have a lot of fires and, the department of forestry, is someone that we’ve talked to about building wildfire sensors, for example, they want to know when fires start so they can put them out more quickly before they become a blazing inferno.
And so, the use cases are extremely wide, and I expect to start to see consumer applications, so far IoT has been focused on business or enterprise or commercial things and usually related to asset tracking or environmental monitoring or something that.
But now because Helium exists and because there’s a sort of broad-scale network that people can use cheaply, we’re starting to see, other types of applications, there are now pet trackers, dog and cat trackers on the network, bike trackers, portable GPS trackers.
I think we’re early in figuring out what the consumer applications are, but I think there’s going to be plenty of them and there’s going to be even more on the industrial and B2B side.
Brian: Okay, cool, and are there particular use cases that you are especially excited about?
Amir: I mean, the wildfire one has always been super interesting to me just because it’s frustrating, that we’re in 2022 and we still have this problem.
We literally can’t do anything about it, a fire starts, and then it’s a hundred acres, and people’s homes get destroyed and people die. And it’s just one of those things that if we had better, sensing, generally things would be better. And as a result of fires, you get really bad air quality.
Better air quality sensing is nice. And there’s just, I think the promise of IoT was always supposed to be, if you had this universe of sensors life would just be better in general. You would know much more about literally everything you came into contact with.
And I still find that to be a really interesting, sort of universe of problems, and then, as you may know, Helium is also now venturing into other types of wireless networks, right? So even though it started as an IoT network and still is, predominantly an IoT network, also starting to move into things like cellular and wifi.
And, I think really the discovery of Helium was that you could incentivize building all kinds of wireless networks this way and IoT just happened to be the first one that we, thought was the least well served or had the biggest sort of pain point.
Brian: So when you say cellular, cause I was hearing, I think I heard an old podcast of yours, but you were asked that question and then you were, basically talking about like, ah that’s really hard.
And I think you asked about 5G. Can you talk a little bit about, how has the network evolved when you say it’s gone beyond, it’s starting to go beyond these IoT sensors?
Amir: If you think about what Helium has done, it’s really enabled people to become participants in wireless infrastructure building.
The fact that it was an IoT network is kind of irrelevant, to some extent, right? It was really more that we sort of hit upon the right economic design.
I think making it easy for people to participate in the network from sort of a user experience standpoint was important.
Most crypto mining, or most IoT gateways, they’re not consumer friendly. If you try using an Ant-miner or you try using an IoT gateway like they suck. And so one of the things I think we did well at the start trying to make this easy to use for consumers and just random people.
That was important, but if you think about that sort of extrapolating it out, you could sort of do that with any kind of network. The fact that we started with IoT was because it was a problem that we were keen on solving that we thought was needed, but very quickly we realized and started getting inbound demand for, building a cellular network this way, right?
Could you have people to deploy, our device called the hotspot, it’s a box about that big. And the question was, what if there was a cellular version of that, could people become miniature cell tower hosts? There are a lot of things that have happened over the last few years that have now made that possible.
There is unlicensed spectrum. Now that you can use it, spectrum access, at least in the United States, and most of the world, is the problem. The spectrum is owned by Verizon AT&T-Mobile, and these massive corporations and the multiple billions of dollars spent, on buying spectrum.
But recently the FCC here in the states, unlicensed this block of spectrum that they call the citizen’s band radio service. And that’s a really big deal because it means that we can operate a cellular network without needing to spend multiple billions of dollars buying spectrum.
And that’s a huge deal, the other part that makes it also a huge deal is that a lot of cell phones already support this. So if you have an iPhone eleven, twelve, thirteen, or if you have any modern galaxy device or, any modern pixel, they already support CBRS as a frequency band, which is the other part of the big deal.
You need to be able to have devices that can take advantage of the network. And then the last part of the big deal is that there are now open-source software stacks that allow you to run, miniature cell towers basically. So Facebook has this project called magma and that’s a big deal too, because usually getting into the cellular infrastructure business, even the cheapest, smallest, cell tower is going to be tens of thousands of dollars in cost.
And so now all of a sudden you’ve got all of these things that make it possible to have a $500 box be a cell tower. And so that’s sort of the next step of Helium is, we figured out how to incentivize the building of wireless networks in general, and now we’re going to start doing it for other stuff beyond IoT, and the next thing that we’re focused on is cellular.
Brian: That’s interesting. And with cellular, do you think in the future, it will be, can I get a mobile phone number, a mobile sort of relationship with, Vodafone AT&T-mobile, Or Helium will it be that kind of thing, or will it be more sort of the backbone to other cellular networks?
Amir: I expect it to initially be more on the sort of backbone side, most is kind of getting nerdy on cell networks for a second, but most cell networks, particularly in the states are really comprised of multiple different networks, that work together.
So, even though you’re using your phone and it says AT&T in the corner, a lot of times you’re hopping around between lots of different networks that AT&T just has a business relationship with. Especially if you go into a sports arena or if you go into an airport or you go, usually another company is operating the cellular network inside those venues, and then they’re sharing the data back with AT&T and it’s all very seamless for the consumer.
For you, you’re just on AT&T and, nothing has really changed. So if you think of it in those terms, and you imagine how big Helium could get as a cellular network, it becomes this gigantic, infrastructure layer that I expect other networks to start to take advantage of. So, we announced this with Dish networks recently, so the Dish is going to start roaming their customers onto the network.
That’s a really big deal, but I expect it to sort of spread to other carriers too, there’s no reason why every carrier wouldn’t want to take advantage of a multiple hundred thousand node network that’s just sitting there that you could use.
I also expect new carriers to form, I know that there are lots of companies that are looking to build, carrier 2.0 or carrier 3.0 in the same way that. Lots of financial institutions now exist, that’s sort of the modern-day version of a bank. There are lots of companies trying to do that and Helium becomes kind of a perfect infrastructure layer for them to use.
So they don’t have to deal with someone Verizon and it’s significantly cheaper and it’s going to be located in places where it’s just not feasible to put a cell tower, for the most part. So it’s going to be super interesting. It’s a very different way to build a network.
I think that’s just going to result in a network that’s just very different, it’s going to be much cheaper and it’s going to be in the coverage is going to be in places that you wouldn’t usually expect and it’s going to be, fascinating to watch that evolve.
Brian: Wow. That’s amazing. And then it will also be of course, global, right by default.
Amir: I mean, it gets hard. The U.S is the only modern country that has unlicensed by.
Brian: Oh, because you depend on the CBRS for that.
Amir: Exactly. And so I’m hopeful that everyone is going to do some version of this, because it’s a big deal to be able to run the open-source cellular network, it’s a huge thing.
And so I’m hopeful that other countries are going to start to do the same thing, but for now, we’re sort of focused on the U.S just because that problem’s already solved.
Brian: Or otherwise, I guess the question could also be, I don’t know if there’s some sort of, DAO or treasury or something that could be then basically buy spectrum in other countries.
Amir: I mean, I love that you said it’s been something that I’ve been thinking about for a while. It’s, you see DAO’s forum to buy the constitution or the Wutang album or whatever and It’ll be awesome. To think of it in a sort of the context of buying spectrum it’s the best possible people-owned asset.
It shouldn’t be owned by a company, I love that idea and it’s also an asset of tremendous value that just keeps going up in value, and so could totally see it. Unfortunately, the entry fee is high. It’s, multiple billions or tens of billions, but it’s possible.
It’s doable, I think it could be done. And I think once Helium in the cellular world is rolling, it’ll be a pretty good example of, here’s what you could do in, Europe, if we just banded together and bought enough spectrum to go do it.
Brian: I think the thing is right with an idea that.
And if you look at something like Tesla, then I think you have this sort of crazy improbable idea. And because people were like, I think this has a chance and they buy up the stock and it has this a gigantic valuation. It gives basically this almost, unlimited stream of capital.
I think crypto networks generally often have that kind of dynamic. I would be pretty bullish that, I mean, you even see that right, with something the ConstitutionDAO, which is kind of crazy. How people kind of come together, raise so much money for this thing.
So I think with something like spectrum this would be people would be most people also don’t have a good experience I think with their cell phone providers. I think pretty much all of the ones I’ve had.
Amir: It’s one of the most interesting things about the space, is that everyone hates the incumbent player.
You can’t find anyone that likes their cell provider or their ISP or their cable provider, or whatever, it universally, every country just hates these people. there’s something just sort of built-in, even if the service is really good, you just are sort of supposed to hate them.
And that’s sort of what’s an interesting position because it makes it easier to sort of get in, you’re not trying to convince people to abandon something that they love. They hate what they have and they wish there was an alternative. And so, it makes it interesting.
It’s not a huge part of the way that we’ve thought about things, but it’s something that I’ve sort of observed over the years of doing this. And it doesn’t matter what country you go to, everyone always has the same opinion.
Brian: So before you were, you’re talking about decentralizing this backbone and then, you’d have, or right now you work with carriers and then maybe you could have new carriers that emerge, I guess just based on the Helium network is there, but is the carrier itself something that you can also provide in a decentralized way?
Amir: It’s a great question, I think so. I mean, the hard part of the equation is that you’ve got to sort of interact with this blockchain and you’ve got to interact with tokens and stuff that. The UI, I think we did a pretty good job of improving the UI for doing that.
Our experience is pretty good, but I still think you have a hard time when it comes to things the Fiat on and off ramps, getting into the ecosystem to pay for things in tokens. Regulation makes that hard, especially US companies that want to participate in that world.
Being a money transmitter or a money exchanger is tricky. So there are things to think about that I think makes the experience difficult in, a fully decentralized way. But you can get pretty close, where you don’t need a specific entity to be your carrier and especially technologies now like eSIM now also is a big deal, right?
Where you don’t need a physical, piece of plastic anymore, that goes in your phone, you just scan a QR code on a modern phone and you’re off and running. So lots of things happening, at the same time that makes this all possible now for the first time.
Whereas otherwise, it would’ve been a nightmare to try and tackle it. Even just two or three years ago would’ve been a nightmare. But now it’s, it’s feasible and doable, and I think we’ve already sold something 20,000 cellular hotspots. So that’s already starting to spread around US and I think is going to start accelerating, for the remainder of the year.
Brian: Then while we’re at it, what about things like the broadband or can you do the physical wire networks also?
Amir: I expect that technology is getting a good enough that you can do away with the cable part completely. There are now enough interesting projects, whether it’s Facebook’s TerraGraph, or company called Tirana, for example that are sort of working on this part religiously.
How do I deliver gigabit broadband to the home wirelessly in some cost-effective way, where I don’t need a million transmitters in a city, I need 50. So I think that’s going to change that kind of technology is going to change the way we think about delivering internet, it doesn’t need to be a cable dug under the street anymore, or overhead, it can be done wirelessly now. And I’m pretty confident that the technology is, that works for that. So I think if you sort of add the Helium model into it, it becomes pretty interesting.
Because you give a really interesting economic model for WISPS, wireless internet service providers. And there are some of those already, it’s just a difficult market to be in right now.
Brian: What’s the difference between a WISP and a normal ISP?
Amir: A WISP delivers the internet connection, completely wirelessly.
There’s no cable involved. So similar to Starlink, you’re getting it from a satellite, but from a WISP, you’re getting it from a transmitter that’s in the same city, it’s somewhere nearby and it is connected to the internet with fiber or something that.
Now the technology is pretty good where it doesn’t have to be a direct line of sight, it used to have to be, it can sort of travel through things. And so it starts to become feasible that you could cover a whole city with 50 of those devices or a hundred of those devices.
And then all of a sudden you don’t need to be digging trenches and having cables anymore. You can deliver gigabit broadband to the home with 50 transmitters in a city if they’re sort of spread out well. And so that kind of stuff is awesome to me because that’s the worst part of the internet, right?
Is that you, you can decentralize all you want at the app layer, at the web3 sorts of a part. But if you haven’t figured out how to open access to the internet in the first place, then you’re always stuck with the old business model of metadata collection and privacy violations and advertising.
You can’t get away from it until you fix that part of connecting to the internet. So for me, I’m fascinated by that part. And, I think in general the internet is very hostile towards privacy stuff, if you try and use a VPN, I’m identifying crosswalks and bicycles every 10 seconds on the capture things.
And so, the internet is not designed for VPNs and privacy. So, I’m optimistic that that’s going to change over time. And I think decentralizing access to the internet itself is a very big and important part of that equation.
Brian: That was exactly what came up in my mind when you were speaking before.
Because you, that is always one thing, that bothers you sort of as a crypto user was you can use all those things, but then in some way, it still feels you are going through this kind of pipe. Which is connected which is controlled by this ISP that I don’t know who they are.
I don’t know what they can do. And so I think then you have I guess, a bunch of projects, things like Tor then you have things, maybe some people working on decentralized Tor versions. There’s this Nym thing and, I don’t know what’s going on with that now, but there was a project called Orchid at some point.
I mean, the Nym thing kind of makes sense to me for sending a crypto transaction, but you want to have the more fundamental decentralization, I think, so that sounds amazing.
Amir: It’s one of these things where, as I was saying, there’s a bunch of DVPN projects.
I think Orchid is one of them and there’s a handful of others. As I said, the user experience of using a VPN is just not very good, I go to Google and I’m now in some other country all of a sudden, Google’s not useful for me anymore because Google showed up in Arabic and I’m not using an Arabic keyboard and everywhere you go, you’ve got a capture to solve literally everywhere.
And so it’s just the user experience of using VPNs is bad because the internet is bad. It depends so much on knowing where you are, and who you are that everything is designed around that, those two things.
And so even when you’ve got the stuff the VPNs and the DVPN, it’s still not great for consumers, which is why it’s not a huge business to be a VPN provider. Consumers aren’t clamouring to be more private online. And I think part of it is just because it sucks as an experience.
And part of it is I think just because users just don’t care that much yet, but hopefully, they will.
Brian: If Helium gets widespread and kind of succeeds, one of the issues is also that in many places you don’t have kind of open access to the internet because you have a firewall or they shut down certain, sometimes you had countries shut down Facebook or social media.
Governments, if people are using that too much is this something where you could build a much more kind of censorship-resistant network that governments can’t censor easily?
Amir: I think it makes it harder. It sort of depends on the level of censorship, right?
I mean, if you build internet access using something Helium makes it much more difficult for someone to shut down just because there are multiple sorts of providers of the internet. Literally everyone can become an internet provider.
The part that’s still easy to shut down if you’re a government is the sort of main backbone of the internet, people still need to connect to the core internet somehow. So that I don’t know. It’ll be interesting to watch how that evolves. That’s still very much cables under the ocean kind of infrastructure.
There isn’t a great way to get back to the internet yet that’s truly censorship resistant. It improves the situation, but I don’t think it’s a perfect solution to, I don’t know, Iran turning off all access to the internet or something.
I don’t know that you can get around that yet, but there’s interesting stuff. I mean, you could deliver it from the sky, Google was doing this with balloons and, Starlink is now doing it with satellites and it’s become much harder to censor.
How are you going to stop access to a satellite? You’d have to go around and find every satellite dish and take it out, and so stuff is heading I think in the right direction where there are more and more options and Helium is one of those tools I think that will help in that fight.
Brian: Pretty excited about this. Is something that’s very needed.
Amir: Helium has grown, I think what we’ve seen over the last two-and-a-half years of Helium existing, it’s grown from zero hotspots to 600,000 hotspots with another 3 million on backorder.
Something like 75% of the US zip codes have access to Helium now. And, it’s grown at an insane pace, and so I think what it’s shown is that people want something this, they want some way to stick it to the incumbent, Tel Co’s, they want some way to earn passive income.
They want some way to get involved in crypto, there are a lot of things that came together at the same time to make this interesting for people, as I said, I think we did a pretty good job of making the user interface easy for people, which was the other part of crypto that I think has traditionally been not very good outside of centralized services, Coinbase, and stuff.
That’s also improving, the wallets are getting better, the apps are getting better, everything is sort of improving. I think Helium has done a phenomenal job, it’s in I can’t even remember how many countries, hundreds of countries.
And I expect there to be three or 4 million hotspots on the network over the next, 24 months.
Brian: One another way that I was sort of thinking about Helium a little bit, that seemed interesting to me, Bitcoin, you can also think of as it’s this sort of economic, it’s this incentive system that has bootstrapped also, kind of the deployment of this, physical network.
Where you have all these miners running these specialized machines, that tends to be maybe more, larger facilities because they need to get cheap electricity. And then these economies of scale there, you still have this, massive investment in this pretty decentralized physical network.
And then here, we have sort of the same thing, but with a different characteristic, right? That it seems to be much more geographically distributed and you don’t have this kind of, you don’t have to use economies of scale. I think in the same way that you have Bitcoin mining.
I’m curious, what do you think is the significance of that?
Or, what are some of the possibilities that, that opens?
Amir: One thing that’s hard about Helium and anything like it is, unlike Bitcoin where just sheer quantity of minors is good enough, they could all be in the same place even, Helium depends on very specific geographic distribution.
A network that’s in one city is useful, but it’s not as useful as a network that’s in every city or every country. But there are some economies there, I mean, all the hotspots on the network are using the same physical components, part of the hotspot are all the same.
So there are some economies of scale that are occurring there because vendors are all buying similar parts and those parts are getting cheaper as the volume increases. The supply chain over the last couple of years has not been great, because of COVID and chip shortages and everything which is affecting multiple different industries.
But in general, a lot of the components are shared, and I think as we move into cellular that’s even more true. A lot of the chips come from Qualcomm, for example. So every vendor is buying stuff from Qualcomm and so, you get the same sort of economies of scale as you would in a more centralized approach because everyone is using approximately the same kind of hardware.
Brian: All of these hotspots, also have a private key and so implicitly a wallet. Do you think that wallet, how do you think that wallet will have usage beyond the kind of narrow function, it has in Helium network. How do you think that’s going to kind of integrate into, people’s digital assets and how they manage them?
Amir: Hotspots are kind of NFTs really, they have a private key and they are non-fungible in a way. They have sort of unique locations and unique characteristics that are different. I think it’s interesting, they’re arguable, they’re some of the first in the physical world, NFTs.
That’s kind of an interesting idea. But the rest of the wallet management has all been done in the traditional way, there’s a mobile app, you can use a ledger, etc.. So I don’t know. It’s a good question, I don’t think we’ve thought about what you could do at the edge there, knowing that, there are 3 million sorts of private key wallet type things out there that you could probably do something with.
I do think we’re starting to have the conversation with lots of different projects, similar to what you’re describing, where there’s a bunch of DVPN projects, for example it would be perfect if we could run our VPN software on your 600,000 hotspots, because that’s a pretty massive VPN network, all of a sudden.
So, I think there are those kinds of conversations that are sort of obvious where it’s, okay, you’ve got this massively distributed network of nodes, what else could you do with it? It’s good for a wireless network, but it might also be good for a bunch of other stuff, I think we’re going to start to see some really interesting things come out, but the VPN one as I said, always been interesting to me because, I’m always so interested in the privacy and, and anonymity.
So that one is always something that’s sort of close to my heart and I would love to figure out a way to enable some sort of decentralized VPN running on Helium nodes because it’s sort of the perfect distribution of hardware for it.
Brian: I would love it if you could maybe dive a little bit more deeply into the Helium network and how does the network look? So, you’ve talked about the wireless network and then you have, the cellular network which is said, different devices. So can you talk a bit about, what is the architecture of the Helium network?
What are the different domain kind of participants in the system, and what are their roles?
Amir: I think a few different ways to think about it. So at its core, Helium is a layer-one blockchain. It’s a completely sort of from scratch written, blockchain network that doesn’t build on top of anything else.
And most of that is because we started this in 2016 or 2017. There really wasn’t a lot to use back then, you either were building on top of Ethereum, which we thought was going to be too expensive even back then, or you were forking Bitcoin, doing something like that.
So we built something from scratch. So at its core, it’s sort of a layer-one proof of stake, blockchain, there’s 3,500 validators who are responsible for block production, transaction verification, and validation. They stake 10,000 HNT, which is the HNT is the sort of native token on Helium.
So something like 35 / 40% of the supply of HNT is staked in validators, who run the network, and then you’ve got the hotspot hosts themselves. And I think the best way to think about hotspots is their kind of a combination of a crypto miner and a wireless access point, it’s a sort of dual-purpose device. The crypto mining part is done through an algorithm that we call proof of coverage.
So the problem that we’re trying to solve was, how do you build the network at the start? Because there aren’t a lot of devices to use the network yet when you’re building, there are none. So you’ve got to kind of build it first and figure out how to build it.
In the physical world application, the hard part is, how do you prove that there’s any hardware in, how do you prove that any of it is real? How does the blockchain know that they are real, there’s real access points out there? So we built this algorithm called proof of coverage where hotspots transmit these encrypted data packets, wirelessly, and the range of a hotspot is extremely large.
In the worst case, it’s about a mile and in the best case, it’s a hundred miles, these hotspots transmit, this is sort of encrypted data back and forth with each other, this sort of challenge protocol and the hotspots earn HNT for this work that they do.
The sort of proof of coverage is the equivalent of our, proof of work in Bitcoin or something, in our world. And the hotspots are rewarded differently. So if you’re creating a big coverage area for hundreds of miles, because you’re on top of a cell tower or something, then you earn more than someone who just has it in their window at home.
Because you’re trying to build a network. So that’s sort of the those are the two sort of host characteristics of the network. Then the other side is users, which are people actually using the network.
So those today are mostly companies, and so they’re companies like Salesforce and Volvo and Costco and Toyota, and companies that actually run sensors on the Helium network are the other sort of participants in the network.
They have to spend HNT in order to actually use the network and that money goes to that HNT goes to the hotspot hosts. So those are sort of the main three actors you’ve got validators hotspot hosts, and users are really the three characteristics in the system.
Then when you start to think about other types of wireless networks, it will work this kind of the same way, you’ll have cellular hotspots that participate in cellular proof of coverage. And then there are cellular users, which will be mobile phone people, mobile phone networks, things like that.
So every type of wireless network will have, the same sort of characteristics where there’s sort of someone on the supply side, the host, and then there’s someone on the demand side, which will be the users. It sort of will depend on the type of network as to who those people are.
Brian: With proof of coverage are they, how secure is this? Are there attack scenarios that somebody can spoof things and tricky-out spots?
Amir: There’s an ongoing amount of work, I mean, as HNT has become valuable and as the network has become valuable, the attack surface has increased, right?
People have figured out ways to sort of trick the system or take advantage of characteristics of the system that were either bugs in the first place, or just things that we didn’t think about at the time, or just really sort of characteristics of the fact that the network, has sort of evolved and gotten big and valuable.
So one example, we just are in the process of fixing this thing where if you happen to have a lot of hotspots offline near your hotspot, then you get challenged in proof of coverage more than you should. So people have figured this out and have started to take advantage of the fact that, if they can find a spot with a bunch of offline hotspots, they can put their hotspot there and make a bunch more money.
So you’re constantly, it’s a huge and complicated project. there’s a lot of pieces, all of them are built from scratch for better or for worse. So, it’s a constant sort of evolving process, to sort of find these problems and improve them and fix them and sort of think about the future of it all.
I think one of the great things that have happened is that the Helium community has gotten bigger and more active. So a lot of this now comes from the community itself rather than from the core development team. I think it’s ultimately what you want, with the project at this scale, you want a very active and involved community and that’s kind of what we’ve ended up with.
It’s certainly not perfect by any means, but it’s heading in the right direction.
Brian: Then do you see this as kind of one. So for example, HNT you’d use that same token for the wireless network and the cellular network and it’s basically a single token.
Amir: Right now there are sort of two tokens really in the system, there’s HNT, which is the main token that you earn for being a hotspot host. It’s the thing that you see being exchanged.
But if you want to use the network, there’s a second token called a data credit, and that’s kind of a stablecoin of some kind, it is fixed in value relative to the dollar, it’s always $0.00001. The nice thing about that system is that it’s very predictable in cost in terms of how you use the network. it’s always going to cost you the same amount of U.S dollars.
The way that you acquire data credits is by destroying HNT. So if you want data credits, you have to take HNT and burn it. And the ratio of that changes because HNT’s values are fluctuating and so depending on how much HNT are worth when you burn one HNT you end up with a different amount of data credits, depending on what the value of HNT is at that time.
But it’s a neat system because it solves one of the biggest problems for utility networks, which is how do you make it predictable for users, if you use the actual, native token and the value of the native token is fluctuating wildly, one day it might cost you a dollar to use the network and the next day it might cost you a hundred dollars.
So we had to figure out a way to, make it stable and predictable, and having data credits kind of act as a stablecoin, as the way to do that. So it’s a really neat system and it’s worked well because it reminds people of cell phone minutes or airline miles, or something that they’re used to.
Brian: I think with this system is in the end, the interesting amazing thing, is that you have this decentralized owned network. So of course, at that point, governance also becomes interesting.
So how do HNT or how does the network governance work today and how do you see that evolving in the future?
Amir: So there’s a sort of improvement proposal process that we borrowed from Bitcoin called the hip. And today, pretty much anyone can create a hip, you can sort of propose whatever, whatever it is that you want. There’s a voting process that is, weighted using HNT. So people vote on whether they these proposals or not.
There are many proposals for how to improve the proposal process, the proposal process should be different. The governance process should be different. The voting process should be different. Everyone has their own opinion about how this should work. And I think, Helium is somewhat unique in that it has sort of a different set of constituents than traditional blockchain networks.
So that poses a different kind of challenge, again, I don’t think any blockchain network has figured out governance at all, in any reasonable way. If you look at Bitcoin core, it’s kind of a gate kept by whoever the Bitcoin core main contributors are in GitHub.
The Ethereum foundation kind of decides what to do with Ethereum and, the coins that use weighted stakes are dominated by whales who own all the currency. And so none of it is, perfect. but there’s, again, a lot of really good suggestions and, and a lot of good proposals on how to improve the governance.
Today it’s sort of the stake weighted process and we’ve actually had a lot of great improvement proposals come through the community that have been implemented. Where it’s starting to get hard now, is that the complexity of actually writing the code is quite high. So to implement any of these changes, takes a lot of engineering work.
So the sort of engineering group or the engineering side of the community needs to grow as well. Otherwise, you’re just sort of preparing proposals that can’t be implemented because there’s no one, there’s no one who has the bandwidth to implement them.
So that’s sort of the next evolution of Helium I think is that the engineering side of the community will need to grow, and actually start participating in writing code against the project.
Brian: Yeah, that is also I think, a hard thing, to do in a kind of decentralized, where even today in most blockchains you tend to have a main development team that kind of does the work definitely can be a challenge. When there’s a disconnect between proposals, people make, and then, the team that actually builds the stuff.
Amir: I think it’s an interesting problem because, the team can only do so much. And so we, have the core development team already has a very massive backlog of major issues and problems and improvements that it’s working on. And so while it’s great for people to make proposals on improvements that they want to see, it’s not always reasonable to expect that the core development team is just going to shift their priorities to work on that proposal.
I think every, project has this problem until the engineering community for that project gets big enough. Then the problem starts to get solved because there’s enough engineering resources to actually work on this stuff, but yeah, not sure what to really say about it or do about it other than continue to try and foster more of that.
The Helium foundation actually has a bunch of grant sort of open for this kind of stuff. So there’s, incentive for people to start doing some of this work. But yeah, I mean, engineers are always hard to come by and, the best ones are usually busy doing something. trying to sort of attracting them to new projects is always a challenge.
Brian: To be honest, I don’t think there’s any blockchain that has sort of figured that out. Cause in the end you have Bitcoin and Ethereum where there actually isn’t that kind of proposal process.
I don’t think there’s any blockchain where you’re at the stage. I mean, it’s also a coordination problem of, how can you get potentially a decentralized governance to manage software development.
Amir: Bitcoin has this problem in a severe way, there’s no, if you’re a distributed system / blockchain engineer, you’re highly incentivized to go work on Solana or Avalanche or Polkadot because those guys have massive treasuries.
They’re going to pay you a lot of money to go do it. Whereas Bitcoin doesn’t have that built-in, there’s no real financial incentive to work on Bitcoin. That makes it hard I mean, people have bills to pay and lives to live and you can’t just work on good vibes.
So people have to make money and that’s a challenge I think in all of these systems and, and mostly I’ve seen it solved through grants. So there’ll be specific problems that a project is looking to solve and will offer sort of a grant to solve that problem.
Hopefully that sort of spurs the ecosystem. I agree with you. I think it’s generally an unsolved problem and the core engineering team is sort of always the core engineering team, I’m hoping that will change over time because it’s the only way that these things really will scale.
You can’t depend on a single team, it’s too much work and too fragmented.
Brian: Is there also a kind of community pool or a mechanism where the community uses governance to directly fund work?
Amir: We don’t really have that today but it’s something that I would definitely like to see.
I think there are some good examples, other projects that have done a good job of that and I would love to see more of that going forward. But today, the grants are managed by the foundation team, and they sort of decide how that goes and take input from the community on how to do it.
Brian: How do you think about the interoperability? So do you see Helium, how do you see it interoperating with other blockchains or the smart contract ecosystems?
Amir: It’s a thing that, it’s one of the downsides of building your own thing and at the time, I don’t think there was a lot of alternatives, we sort of had to do it that way.
But, I would love for HNT to be sort of a participant in the DeFi ecosystem for example, and that’s not happening today. So a few groups are working on bridges and wormholes to other chains. So there’s a group working on Algorand one, there’s a group working on Solana one, I’d love to see something on Ethereum.
I like the bridging approach. I mean, there’s been a few hacks and attacks on the bridges, over the years, which makes sense, they’re high profile with a lot of money. We’ll see it, over time, maybe the sort of ledger part of Helium moves to some existing layer-one and the layer-two sort of remain on Helium as their own sort of miniature blockchains.
There’s a proposal in the community right now. So we’ll see, but, I think it’s highly valuable for HNT to be part of that greater ecosystem and part of that broader ecosystem, for sure.
Brian: I think that will for example, if you think of this buying spectrum idea, in essence that’s a huge financial transaction. And then I think if you can do that sort of as part of this crypto financial system that will unlock a lot of probable possibilities that you can’t have if you don’t have those connections.
Amir: It’s a challenge for sure, again, it’s one of those, problems, right? Where everyone is sort of building their own blockchain with their own community and the sort of bridging is supposed to be the solution to that.
I think what’s hard still is that none of the smart contract blockchains are really capable of doing something quite as complicated as Helium as a layer-two, or sort of on top of those networks.
It’s just too much state and too much stuff to try and manage. So I think that’s part of what makes it difficult, is that, you’d have to figure out some sort of combination where you still have validators running the network, but the ledger is on a different chain, or something like that.
We’re looking into that kind of stuff, there’s a few proposals in the community about how we might want to do that, it’s something I’m personally quite excited to figure out how to do. But, I think for now, it would probably be a bridge or a wormhole or some equivalent that would be the best way to make it happen quickly.
Brian: I think that would be a fine solution. You have things Axelar and Wormhole and I think, they’ll easily connect Helium to all the blockchains and I think it will be the best solution probably. Or you have things like IBC but that’s more work to implement I think.
Amir: Yeah, for sure.
Brian: Then do you also see enabling the deployment of smart contracts directly on Helium as a direction?
Amir: It’s possible, there’s a proposal in the community right now to sort of basically have Helium be sort of a network of networks, where there’s lots of different types of wireless networks that layer sort of the second layer.
So how that’s implemented, I think remains to be seen, I could see it, I could see it being possible, but I think the purpose of the smart contracts would have to be quite precise, I don’t think there’s a whole lot of value in Helium trying to be another smart contract blockchain.
There is already so many of them that are focused just on doing that and will certainly do it better than we could. So I think if there were smart contracts, it would have to be specific to a purpose, deploying wireless networks or deploying networks or deploying distributed applications that are networking related or something very specific to the sort of purpose of what Helium is.
Otherwise, I think you’re in danger of just being another, I don’t know, IOTA kind of reminds me of that, now it’s sort of another, it’s an Avalanche clone now and I don’t really know what distinguishes something like IOTA from Avalanche and so I think you got to be a little bit careful about trying to just do it all because there’s already people that are already doing that and do a better job than we could.
Brian: That’s a tricky, I think that’s a sort of tricky balance I can have worked a lot in the Cosmos ecosystem and there, I think there’s also a lot of this, that kind of balance.
Where you launch a chain and then it has certain functionality and then maybe some people want to add things to the chain. Then there’s a question of okay, this is a governance process, which makes it very hard to innovate. Or if it becomes a general smart contract thing, then it again, it comes away maybe a bit from this being very purpose, specific.
And maybe also we’ll have, issues in terms of performance, right. If there’s too much other stuff running on.
Amir: It’s not a problem that Helium is focused on, we’re here to help build network infrastructure in a decentralized way and not for minting NFTs or building some sort of DeFi platform or something.
There are already so many places to do that, so, I think to me that would be, if we went down the smart contract path, that would sort of need to be its focus.
Brian: What other biggest challenges that you see in the future?
Amir: That’s a good question, I mean the thing that I probably worry about the most in the short term is as we add more wireless networks, so things cellular and Wi-Fi and stuff, making sure that the incentive model is good enough, because you’re going to start distributing HNT across multiple different types of networks, so it’s going to start getting more diluted than it is today where it’s sort of all going to a single type of network. So that’s going to be an interesting type of challenge.
Like as the 5g network grows, it’s going to be taking away rewards from, the IoT network. So there’s going to be a little bit of competition among networks, which may be good, but may also be bad. So not exactly sure how that’s going to go, but that’s definitely, a concern that I have.
There’s a lot of technical challenges that we’ll face. I mean, I think Helium is already the largest peer-to-peer network that has ever been built as it’s 600,000 nodes on a peer-to-peer network.
So there are all sorts of engineering challenges that come with that, that really only has been solved in theory, there’s a lot of theoretical writing about peer-to-peer networks at this size. Not that many have actually done it. So there’s that kind of stuff, I think, we have the right roadmap already to sort of mitigate a lot of that.
But just dealing with something at this scale, is a huge undertaking. I think we’ve served something like 5 billion requests to the API server over the last month or something that. So it’s at a large scale where scaling problems become real, especially scaling problems that don’t have well-known solutions.
I think scaling web applications is quite well understood. Scaling peer-to-peer networks is not really well understood. So there are just some challenges there that we’re facing and working through. But overall, I think I worry about them less than the economic challenges.
Brian: I can see that as being a hard problem. Because in the end you’re sort of using the expectation of the future returns maybe of the different networks to pay now, you don’t know what those are.
What’s the usage today? How much business does the network do in terms of, packages it’s selling to sensors or other users?
Amir: On the sensor side, one of the challenges I think with IoT in general is that the market for it hasn’t really existed properly because there really hasn’t been any network for IoT stuff to really use on a broad scale.
Most people who have sort of operated in IoT have done it in the confine of their building or in the warehouse. So there haven’t really been many applications where you assume that there was a network that was kind of a cell network or a mobile network. So you’re kind of, the hard part about Helium in the IoT space is that you’re sort of bootstrapping both sides of the network at the same time.
You’re trying to build a big coverage network and then you’re also trying to get people who are interested in IoT or have problems, or have applications to start building them and everything, when hardware is involved is slow, for someone to build a sensor application, to build a hundred thousand sensors, for example, is always going to be an 18 month job.
At least not from what I’ve seen there’s not a way to shortcut that length of time because you’ve got to test the thing and certify it. There’s just so many steps required to actually make something work and then manufacture it.
That part is tricky, and so with a cellular network, you don’t have the same problem. you have a slightly different problem, but there are a lot of end users and there are a lot of known applications, there are multiple billion cell phones out there and so you kind of know who your users are.
You don’t have the same problem, you have a customer acquisition problem, but it’s a different, type of problem, that you have in the IoT universe. So, it’s definitely a challenge that requires a lot of patience because, you’ve got to sort of, everyone involved in Helium has to sort of understanding that IoT side of the network is just going to take years, in order for real usage to come.
Because real usage is going to require manufacturing lots and lots of sensors and just that process alone is always going to be a couple of years long, even once the problem is identified and solution tested and everything else. It’s slow and I think that’s a part that I wish we knew how to make go faster but I’m not convinced that there is actually a way.
Brian: So we talked a little bit about privacy, but I would be curious about privacy specifically with regards to IoT, I mean, on some level that seems a little bit scary too. Because if privacy are already not so good, and then you also have, lots more devices that are giving away lots more data continuously.
Do you think it’ll be possible to have IoT widely adopted while maintaining or maybe even improving people’s privacy?
Amir: I think the privacy concern is different than sort of the big internet privacy concern to me. The big internet privacy concern is more like ISP knows my browsing history, knows sort of everything that I do on the internet at least to some level. There’s definitely a potential for a concern in the IoT space. If you have a lot of sensors all over the place they could for sure it could be used maliciously, the sort of approach is a little bit different, right?
You’re not really connected to the internet in the same way, I think we always have to be calling some the fact that there’s danger there. People could track people without their consent. And I think people have already started to do that with air tags, for example, right?
They drop them in people’s purses or in their car or whatever and all of a sudden you have a tracking device on someone that they don’t know is there. I think you’ve always got to be worried about that kind of stuff, but it’s probably not necessarily unique to IoT.
Brian: Thanks so much, Amir, it’s been really great to hear about Helium I think it is just an amazing accomplishment, I think, to build this physical crypto controlled network out and I’m really excited about all the things that will become possible with it.
I think also that the intersection between crypto applications and having this physical network I think will be very powerful.
So yeah. Thanks so much for coming on, Amir.
Amir: Yeah. Thanks for having me, I’m glad you’re interested and excited about what Helium is doing and super excited to see what comes next.
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