What Is Helium? An Innovative Power Of Coverage Network in 2022


What is Helium?

The Helium Blockchain is built on a new, revolutionary work method known as Proof of Coverage (PoC), and miners are rewarded in $HNT, the Helium blockchain’s native currency, in exchange for their efforts.

The Helium Blockchain, which was officially released on July 29, 2019, is the technology that supports the world’s biggest public, decentralized LoRaWAN network.

Helium Blockchain Primitives


In the Helium blockchain, blocks are used to record the most current set of transactions that have occurred.

Blocks are mined in accordance with the block time chain variable, which is defined as follows: The target block time is currently set at 60000 milliseconds (or 60 seconds). During any given era, the most recent block is comprised of the following elements:

  • Block Version
  • Block Height
  • Previous Block Hash
  • Transactions (stored as a Merkle hash)
  • Threshold signature from the current consensus group

The Helium Blockchain Explorer is the quickest and most convenient method to observe the blocks currently being mined. The Helium Mobile App also displays information about the blocks.

Users of the Helium blockchain API may also have access to all blockchain transactions and information, which is very useful for developers.

What Is Helium? An Innovative Power Of Coverage Network in 2022
Source: Helium


It is the goal time period for which a certain group of Miners is picked to serve as the consensus group that is referred to as an epoch. In accordance with the election interval chain variable, the goal period for an epoch is presently set at 30 blocks in length.

In the Bitcoin network, each epoch is marked by the mining of about every 30 blocks, following which a new group of Miners is chosen to form the next consensus group. Mining payments are allocated on an epoch-by-epoch basis (as opposed to per block in most blockchain-based systems).

At the end of each epoch, the consensus group will distribute all of the $HNT that has been generated in that block via the use of the rewards transaction.


At the moment, the Helium blockchain supports 20 different transaction types. One kind of occurrence is found in virtually every block mined, whilst another was designed to be utilized just once and will never be seen or heard from again.

Using the Helium Blockchain Explorer, you can view a variety of different transaction types in action. Transactions are represented as Protocol Buffers, often known as “protobuf,” at the lowest level of abstraction. The actor signs the serialized protobuf after it has been signed by the other signature fields (if any) that were previously included in the transaction. The protobuf definitions may be found on this page.

All transactions take place on the blockchain, and all transactions need the submission and confirmation of Helium Data Credits. The following is a list of the transactions that are supported:

  • add gateway – Add a new gateway to the Helium Network. For the purposes of transactions, a “gateway” is the term for a Helium-compliant Miner that is mining and providing coverage.
  • assert location – Assert a gateway’s location on the Helium Network. This happens after a gateway has been added via the add gateway transaction. Once asserted, this location is then used as part of Proof of Coverage challenges. A Miner’s location can be asserted more than once but each subsequent assertion will a) cost a fee and b) reset that Miner’s score to neutral (.15)
  • chain vars – Change a chain variable.
  • coinbase – Similar to the bitcoin blockchain’s coinbase transaction but used only during testnet phases of the Helium blockchain. The rewards transaction has taken its place.
  • coinbase data credits – Created the initial 10,000 Data Credits required to bring the first group of Miners online.
  • consensus group – Marks the election of a new consensus group, responsible for mining during the next epoch.
  • create hashed timelock – Creates a transaction that can only be redeemed by providing the correct pre-image to the hashlock within the specified timelock.
  • create proof of coverage request – Submitted by a Miner wishing to initiate a challenge.
  • data credits – Burn HNT for DCs at the current oracle price and deliver them to the target wallet address.
  • genesis gateway – Used to define the initial group of Miners that bootstrapped the blockchain.
  • multi-payment – Used to send $HNT from one wallet to multiple wallets.
  • OUI – Create a OUI for a new router on the Helium network. In the Helium blockchain, Miners forward packets to Routers that own them based on their OUI as stored in the blockchain.
  • payment – Used to send $HNT from one wallet to another.
  • proof of coverage receipts – The result of a POC submitted to the network upon completion.
  • redeem hashed timelock – Redeem the transaction created using the create hashed timelock transaction.
  • reward – A token payout for a specific event on the network such as submitting a valid proof of coverage request, participating in a consensus group, etc.
  • rewards – Bundles multiple reward transactions at the end of each epoch and distributes all $HNT produced in that block to wallets that have earned them.
  • routing – Update the routing information associated with an OUI.
  • security coinbase – Distribution of security tokens in the genesis block.
  • security exchange – The transfer of security tokens from one address to another.
  • state channel open – Opens a new state channel on a Helium Router
  • state channel close – Closes a specific state channel on a Helium Router
  • token burn exchange rate – Change the exchange rate for burning $HNT to DCs.

Chain Variables

Helium blockchain configuration variables, also known as chain variables or chain vars, are a collection of configuration options for the blockchain.

In a POC Challenge, Chain Variables may be used to adjust things like the target block time, the target epoch time, the minimum number of targets required, and many other things.

When a transaction containing the chain variable to be updated, its new value, and the signature of the chain variable master key is submitted, the chain variable is changed.

Accounts, Wallets, and Keys

The Helium blockchain, in contrast to the Bitcoin blockchain, employs an account-based system for wallets and balances (similar to Ethereum and others), rather than a UTXO-based ledger, as does the Ethereum blockchain.

In order to create Helium wallets and manage their private keys, users may choose from a number of different options:

  • If you’re using the Helium Mobile Wallet (iOS, Android), your private key is encrypted locally (and can be recreated on another mobile device using the 12 word passphrase generated when your wallet was first created);
  • Using the Helium CLI Wallet, users are responsible for creating, storing, and securing a wallet’s private key and associated passphrase;

In both the Helium Mobile Wallet and the CLI Wallet, keys that are based on the ed25519 public key signature mechanism are generated and used. In addition, the CLI may handle NIST p-256 keys. The Helium blockchain, on the other hand, accepts both sorts of keys.


Validators are cloud-based nodes that were first introduced in HIP25 and were formally deployed to Mainnet on July 7, 2021.

They are responsible for processing blocks and monitoring the blockchain consensus group. Validators get the 6 percent of HNT allotted to the consensus group reward in exchange for protecting the network and ensuring its integrity. To run a Validator, a stake of 10,000 HNT is required.

Mining and Token Rewards

There is no specific formula for determining how much HNT you will earn over a particular length of time, but it is important to bear in mind several higher-level notions, design features, and principles that will help you better understand what you may earn and why you might earn it.

This section includes information on these topics, as well as some mining and token reward fundamentals.

How Do Helium Tokens Get Earned at Hotspots?

For providing wireless coverage and authenticating the Helium Network, Hotspots are rewarded by the Helium blockchain, which runs on the Ethereum blockchain. Hotspots are awarded in Helium Token, which is denoted by the symbol $HNT.

Every epoch, the present consensus group mines around 30 blocks on the blockchain, which is a significant amount of work. Hotspots carry out a variety of tasks in each block, and they are compensated in accordance with the following distribution of rewards:

Reward TypeDescription
PoC ChallengerRewarded to any Hotspot that creates a valid PoC challenge and submits the corresponding receipt to the blockchain.
PoC ChallengeesAwarded to any Hotspot that transmits a PoC packet after being targeted by the challenger.
WitnessesDistributed to all Hotspots that witness a beacon packet as part of a PoC Challenge.
Consensus GroupDivided equally among the Validators that are part of the outgoing Consensus Group, responsible for mining blocks.
SecurityAwarded to Helium, Inc and other Network investors who hold Security Tokens.
Network Data TransferDistributed each epoch to Hotspots that route LongFi sensor data for sensors on the Network during that epoch.

Do I Have To Actively Participate to Earn Rewards Once My Hotspot is Deployed?

No. The owner of a Hotspot does not need to do anything further in order to earn $HNT after the Hotspot has been fully installed and properly synchronized with the Helium blockchain. During its operation, your Hotspot will carry out all of the aforementioned tasks on its own.

Target $HNT Production Per Epoch

By August 1, 2021 (the date of the most recent halving), the anticipated production rate for new $HNT coins to be issued every month is 2,500,000.

This indicates that, assuming the blockchain operates as intended, it will generate 2,500,000 HNT every month if everything goes according to plan.

Based on the following two factors, which are specified in their respective chain variables, this target rate is calculated:

  • Target block time is 60 seconds.
  • Target epoch size is 30 blocks.

Remember that, on the Helium blockchain, blocks include a certain number of unique transactions, and epochs are composed of all the blocks mined by the current Consensus Group since the previous epoch, as explained above.

In other words, assuming the Network meets its goal block speed of 60 seconds and target epoch of 30 blocks, the blockchain will generate 2,500,000 HNT every month.

This corresponds to around 1712.704154343 HNT every era. The mathematics behind this is as follows:

  • (43200 minutes per month / 30 minutes per epoch) = 1440 epochs per month
  • (2500000 tokens minted per month / 1440 epochs per month) = 1736.1111 HNT per epoch
What Is Helium? An Innovative Power Of Coverage Network in 2022
Source: Helium

HNT Distributions Per Epoch

In accordance with the calculations above, the desired HNT per epoch is roughly 1736.1111. Where does all this HNT go, is the next natural thing to consider. Let’s have a look at this.

As of August 1, 2021, the following table shows the mining rewards by era. Following the conclusion of each entire epoch, which is marked by the election of a new Consensus Group, all of the HNT created is allocated among the reward kinds listed below:

Reward TypePercentageHNT Earned by Reward Type
PoC Challenger0.90%15.6250
PoC Challengees5.02%87.1527
Consensus Group6%104.1666
Security Tokens33%572.9166
Network Data TransferUp to 35%Up to 607.6389

Rewards Change Over Time

HNT Proration and Slow Block Times are two of the most important factors to consider.

Because the Helium blockchain is still in its early stages and expanding rapidly, there are issues to be fixed and improvements to be performed. It might be challenging to get consistent block and epoch timings when setting targets.

In order to account for this, the Helium blockchain employs a technique known as proration to guarantee that the aim of 2,500,000 is fulfilled even if block and epoch periods are not met on time.

Blocks, not clocks, are responsible for the target HNT.

It’s simplest to think about desired HNT production over the course of a month or less. It is expected that the blockchain will work as expected, resulting in about 1460 epochs every month, culminating in the production of 2,500,000 new HNT.

Time is measured by a clock when they say something is “one month.” Nonetheless, they utilize block time and the epochs that emerge from it to track HNT generation versus Helium’s goal. HNT production is lowered proportionately when blocks are sluggish, as a result of this.

Block times slow down, which means that everyone earns less.

The most essential thing to take away from this is that as block times slow down and HNT output decreases, everyone involved in the network – witnesses, challengers, security token holders, and so on – is affected equally and negatively (with the exception of Consensus Group members; more on this below).

So, although it’s frustrating that the effective rate of HNT may have decreased over a period of time, keep in mind that you’re not the only one who has seen a decrease in earnings. And this is done on purpose.

Proof of Coverage

Proof of Coverage (PoC) is a revolutionary work technique developed for the Helium blockchain that verifies that Hotspots are situated where they claim to be located.

Another way of putting it is that the Proof of Concept (PoC) aims to validate on a continuous basis that Hotspots are accurately describing their location as well as the wireless network coverage they are producing from that place.

Why Proof of Coverage was chosen

Users that deploy connected devices on the Helium Network will benefit from the amount of reliable coverage that the network can provide.

The Helium Network is a physical wireless network that will succeed depending on the amount of reliable coverage that it can provide. As a result, it necessitated the development of a work algorithm specifically designed for this application. Proof-of- In order to provide proofs that are important to the Helium Network and its members, coverage makes use of the unique and indisputable features of radio frequency (RF). To be more specific, PoC is based on the following characteristics:

  • RF has limited physical propagation and, therefore, distance
  • The strength of a received RF signal is inversely proportional to the square of the distance from the transmitter
  • RF travels at the speed of light with (effectively) no latency

The Helium Consensus Protocol

Anyone running a Hotspot in line with the consensus rules and network specifications should be able to participate freely in the Helium Network without the need for further permission.

Truly decentralized by design – There should be no motivation to take advantage of variables such as low energy costs or the ability to deploy additional gear in the same place.

As long as a sufficient number of players are behaving honestly, the protocol should be fault tolerant, allowing for the achievement of agreement in the face of Byzantine failures. They chose a variation known as HoneyBadgerBFT for this purpose, which is described in further detail below.

Achieving network agreement should be based on effort that is both helpful and recyclable to the network. As a result, effort conducted to reach agreement in Nakamoto Consensus-based systems, such as the Bitcoin blockchain, is only valid for a given block of time. The Helium consensus mechanism, on the other hand, should be able to conduct work that is both helpful and reusable to the network in addition to merely safeguarding the blockchain.

Exceptionally high rate of confirmed transactions – The protocol should be capable of completing a large number of transactions per second, and once a transaction has been viewed by the blockchain, it should be presumed to have been completed. Long block settlement periods, which are characteristic of other blockchains, are not acceptable for users transmitting device data over the Helium Network.

Transactions that are not subject to censorship – Hotspots should not be able to filter or otherwise pick / deselect transactions that are to be included in a block.

What Is Helium? An Innovative Power Of Coverage Network in 2022
Source: Helium

HoneyBadger BFT

This protocol is based on a modified version of the HoneyBadgerBFT (HBBFT) protocol, which is described in more detail below.

A corpus of research initiated by Andrew Miller and his colleagues at the University of Illinois at Urbana-Champaign served as the foundation for the development of HBBFT.

HBBFT is an asynchronous atomic broadcast protocol that is meant to allow a group of known nodes to reach consensus across unstable networks. It is implemented in Java.

During the implementation of Helium, a consensus group of chosen Validators receives encrypted transactions as inputs and then continues to obtain common agreement on the sequencing of these transactions before generating a block and committing it to the blockchain.

HBBFT is based on a cryptographic technique known as threshold encryption. Transactions are encrypted using a shared public key, and they can only be decrypted when the chosen consensus group works together to decode them, according to this protocol.

The use of threshold encryption allows the Helium Consensus Protocol to accomplish censorship-resistant transactions via the use of asymmetric encryption.

The Helium Token

The Helium Token is the native cryptocurrency and protocol token of the Helium blockchain, and it is used to transact on the network. It is represented by the symbol HNT.

There was no HNT premine prior to the introduction of the Helium blockchain and the creation of the HNT token. A HNT was generated for the first time on July 29th, 2019, as part of the block 93.

Helium Token Usage

This token is intended to meet the demands of two key stakeholders in the Helium blockchain ecosystem: the Helium Foundation and its users.

Hotspot hosts and network operators are two types of service providers. Hosts mining for HNT while simultaneously establishing and maintaining network coverage coverage.

Enterprises and developers who are using the Helium Network to link devices and create Internet of Things (IoT) applications. Data Credits, which are a utility token tied to the dollar that was created by burning HNT, are used to pay transaction fees for wireless data transfers on the network.

Data Credits are obtained from HNT via a burn transaction (in addition to things like adding Hotspots and sending).

Max Supply

The Helium Network set a monthly aim of 5,000,000 HNT at the time of its genesis block launch. Furthermore, since the community’s ratification of HIP 20, the Helium blockchain has been operating on a two-year halving schedule, with a maximum supply of 223,000,000 Helium Network tokens.

The halving of HNTs occurs every two years starting with the genesis block, according to the following timetable.

HNT Price Oracles

HNT translates to Data Credits at a rate linked to $.00001, and the blockchain needs a canonical HNT/$USD price for this conversion in order to function properly.

Since the beginning of June 2020, the Helium blockchain has relied on a system of decentralized pricing oracles to offer the $USD to HNT price that is utilized for on-chain burn transactions on the blockchain. (This system was inspired by the Oracle implementation used by the Maker Foundation.)

In order to determine this price, nine oracles (this number may vary in the future) provide HNT/$USD prices on a regular basis.

As soon as the blockchain receives sufficient fresh pricing data, it will compute a new HNT/$USD price, which will stay valid until a sufficient number of new, valid oracle inputs are received, which will result in a new price revision.

Who are the HNT Price Oracles?

Prices for the HNT Oracle are provided by a set of eleven (11) Oracles, which are made up of corporations, organizations, and people. They are as follows:

  • Helium, Inc
  • Decentralized Wireless Alliance (DEWI)
  • Nine (9) Anonymous Individual Community Members

Their decision to keep the identity of the individual feed contributors private is necessary in order to avoid any external efforts at extortion or blackmail.

While the identities of significant firms and organizations that give feeds are not publicly available (as they should be), it makes it simpler for them to identify and prevent possible threats and bad actors.

Transaction Fees

Helium, like the majority of blockchains, operates on a transaction fee basis. All transactions on the Helium blockchain are compensated in Data Credits, which are virtual currency (DCs).

Data Credits are created by burning a certain quantity of HNT via the use of an on-chain transaction.

Furthermore, owing to a technique known as “Implicit Burn,” customers are no longer need to physically deliver DCs in order to pay fees.

As long as the Helium wallet being used to submit the transaction holds sufficient HNT to burn to DCs in order to pay the transaction, the burn will take place implicitly, with no need for user interaction.

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