From blockcrunch by Darshan Gandhi

Introduction

Helium is undeniably the leader in DePIN (Decentralized Physical Infrastructure Networks). If you’re familiar with this space, you’ve likely heard of it. Rather than focusing on the basics, this report dives into advanced topics—key statistics, real-world case studies, upcoming developments, and a broader look at the DePIN ecosystem and decentralized wireless (DeWi) technology, which is where Helium is doubling down right now.

Here’s what this report covers:

Before diving in, let’s take a quick look at what Helium is and how its network has evolved over the years.

So, helium is a unique wireless network built & operated by the “community“, not traditional web2 telecom companies. It’s a bold attempt to decentralize the wireless infrastructure industry by letting individuals deploy hotspots to build connectivity. In return, these contributors earn rewards, creating a unique alignment between network growth and real-world demand. This approach eliminates dependence on telecom giants, offering a more scalable and cost-effective alternative to traditional networks.

Helium’s journey so far

Helium started in 2013 with a mission to create a decentralized IoT network. It launched its first LoRaWAN-based network in 2019, targeting low-power devices like sensors in agriculture, logistics, and smart cities. By 2021, it had grown into one of the largest decentralized networks globally, with over 450,000 hotspots deployed in 34,000 cities across 161 countries, but it didn’t get to the desired demand as expected (more on it later in the report).

In 2022, Helium entered the mobile space with its 5G network, expanding into new use cases. This marked its evolution from an IoT network to a broader infrastructure provider or how they call it today a “network-of-networks“. Today, Helium supports various wireless technologies like WiFi and VPN and develops sector-specific ecosystems through subDAOs.

If you’re excited to learn about the history of Helium, you could more about it here.

Why Helium matters?

Traditional telecom providers monopolize the wireless industry, controlling infrastructure, spectrum, and pricing. This centralized approach inflates costs, slows innovation, and focuses primarily only on urban markets while leaving rural areas disconnected. Deploying and maintaining networks under this model involves significant CapEx and OpEx, with these inefficiencies passed on to users.

For eg: in USA, three corporations dominate 99% of the wireless market, making alternatives nearly nonexistent.

Deploying and maintaining networks under this model involves significant CapEx and OpEx, with these inefficiencies passed on to users.

Building and maintaining networks under this system is slow and expensive, with costs ultimately passed on to consumers, while underserved areas remain disconnected.

Helium wants to try to change this - by decentralizing network ownership, it enables individuals to deploy hotspots and earn rewards for providing coverage. This crowdsourced model reduces costs, speeds up deployment, and ensures coverage grows where it’s needed most, without relying on lengthy approvals or major investments.

Helium’s incentive system is a big reason why it works. Instead of charging contributors, it rewards them with tokens for helping the network. This builds trust, keeps the system transparent, and makes the network sustainable.

So what does Helium offer?

Here’s a quick understanding about what it takes to set up a network in traditional web2 scenario vs helium

So, that’s a good understanding about why does Helium even matter. Let’s now first dive deeper into understanding, what’s depin all about and why does it even matter.

What’s DePIN?

Decentralized Physical Infrastructure Networks (DePIN) offer a decentralized alternative of building infrastructure using blockchain and token incentives. It shifts control from centralized entities to individuals who contribute resources like capital and labor. This makes infrastructure efficient, scalable, and resilient while lowering costs.

How it works?Contributors deploy assets (e.g., hotspots or sensors) and earn token rewards. Networks grow organically as more people join, creating a cycle of better services, wider coverage, lower costs, and increased participation.

This creates a positive feedback loop, often referred to as the DePIN Flywheel:

State of DePIN

Applications across industries

Ofc Depins also have their challenges circling around scaling, bootstrapping issues, lack of user incentives over a period of time and so on. But most of the these apps are extremely heavy revenue making first projects as compared to the other broader web3 applications which struggle to make any revenues.

The spectrum of offerings is also spread across depending on whether one of targeting growth over

What we can also see/ expect to unfold over the next couple of years (especially since Trump’s gov is going to start from 2025), a more deeper focus and opportunity for depin to succeed. Some trends we could be on the look out for:

DePIN provides a sustainable, utility-focused model to replace inefficient centralized systems and over speculation (what most of the other web3 verticals offer), but its success depends on overcoming regulatory and scalability challenges.This is a great graph to understand how the network wins if they are able to sustain over a longer period of time and have sustainable growth.

Decentralised wireless networks

Traditional wireless networks dominate the landscape, here’s a quick understanding of realising the massive market opportunity that’s present in operating and running wireless networks.

DeWi networks combine blockchain incentives with physical infrastructure, allowing individuals to manage nodes, earn tokens, and support scalable, cost-efficient connectivity.

Categories:

Timely emergence:

Economic opportunities:

Innovative models:

Again, this report by ev3 is one of the best reports i’ve read on understanding the DeWi landscape deeply.

Here’s a good comparison of the live tokens in the market and how helium compares against them on the secondaries (on a high level).

How does helium work?

It connects hotspot operators, device users, and governance participants, creating an alternative to traditional telecom.

The flywheel effectAs more devices use the network, the demand for DCs increase. This leads to more $HNT being burned, raising its scarcity and value. The higher token value incentivizes more hotspot deployments, which improves coverage and attracts even more users. This positive feedback loop can help drive scalable network growth.

Helium combines infrastructure, PoC validation, data tokenomics, and governance into a scalable decentralized system. Here’s a good flowchart understanding of how the helium network is interlinked on a high level.

What is proof of coverage?

Proof of Coverage (PoC) is Helium’s mechanism to verify that hotspots provide valid wireless coverage and are accurately located. It ensures trust, fairness, and reliable rewards in the decentralized network.

How PoC works?

PoC uses a continuous challenge system with three participants:

PoC plays a crucial role in ensuring the integrity of Helium’s network by verifying hotspot locations and coverage, preventing fraudulent activity. It ensures fair rewards by aligning token distribution with hotspots’ actual contributions through PoC participation. This mechanism also promotes strategic hotspot placement, encouraging efficient and wide-area coverage rather than overcrowding in specific locations.

While attempts to game the system, such as faking locations, have posed challenges, Helium has implemented stricter verification methods and penalties to counter such behavior. Continuous upgrades further enhance PoC’s robustness, maintaining its reliability as the network grows.

PoC in SubDAOs:

It’s probably one of the most crucial elements of Helium!

Understanding data credits (DCs)

Data credits are a non-transferable currency used to access Helium’s network services like data transfer, device onboarding, and hotspot location assertions. Pegged to $0.00001 per DC, they offer stable pricing regardless of $HNT’s market volatility. DCs are acquired by burning $HNT, permanently reducing its supply and linking network usage to token scarcity.

How DCs work?

Helium faces some significant challenges in driving the DC demand which in turn resonates to the actual network growth. Slow growth in IoT adoption limits DC burns within the IoT SubDAO, reducing its overall contribution to the ecosystem. Additionally, currently Helium Mobile accounts for 90% of all DC burns, creating a heavy reliance on this segment and underscoring the need for more diverse use cases. Market volatility further complicates the system, as fluctuations in $HNT’s price affect the purchasing power of DCs and the rate at which they are burned, impacting the network’s deflationary dynamics.

Expanding Helium Mobile, forging partnerships, and increasing IoT applications will be key to boosting DC demand. Higher DC burns will enhance $HNT’s deflationary effects and strengthen Helium’s ecosystem, driving long-term growth.

HNT: Utility and Tokenomics

The Helium Network Token ($HNT) powers the ecosystem by incentivizing participants and supporting decentralized wireless connectivity. It plays a central role in rewarding hotspot operators, facilitating data transfers, and enabling network governance.

Key Utilities of $HNT

Tokenomics

The Helium Flywheel

By integrating rewards, network activity, and governance, $HNT tries to sustains Helium’s ecosystem. Its deflationary model and link to network usage ensure long-term growth while incentivizing participation.

Here’s a detailed balance sheet of how $HNT has performed over the last few years & quarters. If you’ like to play around more, check out this dashboard.

→ Y-o-y changes

→ Q-o-Q changes

Helium's SubDAO’s

Helium’s "network of networks" relies on SubDAOs, like IoT and Mobile, to manage specific subnetworks with independent governance and tailored rewards. SubDAO tokens ($IOT, $MOBILE) incentivize operators for activities like PoC and data transfers while linking their performance to $HNT through redeemability and utility-based rewards.

This modular structure drives growth by rewarding high-performing subnetworks, ensuring scalability and resilience. Decentralized governance within SubDAOs, alongside the Helium DAO, balances emissions and fosters collaboration, making SubDAOs integral to Helium’s decentralized ecosystem.

Who are the major stakeholders in the Helium network and how do they contribute?

The network thrives on the contributions of four main stakeholder groups:

Each group plays a critical role in the ecosystem’s growth, scalability, and sustainability.

Incentive alignment

By combining staking and burning mechanisms, all stakeholders strengthen Helium’s economic sustainability,

Here’s the funding history of helium

Helium’s evolution: From IoT to a network of networks

Helium began as a decentralized IoT network, enabling low-power devices to connect via LongFi, a mix of LoRaWAN and blockchain. Hotspot operators provided wireless coverage and earned $HNT through the PoC mechanism. By 2022, Helium had deployed over 900,000 hotspots worldwide, making it the largest decentralized IoT network. However, low IoT data demand and overreliance on a single market exposed limitations, particularly during $HNT’s price volatility in the 2020 crypto bull market.

To address these challenges, Helium transitioned to a "network of networks" model in 2022, introducing SubDAOs like IoT and Mobile SubDAOs to manage specific wireless technologies. These SubDAOs operate independently with tailored governance and tokens ($IOT for IoT, $MOBILE for 5G) while maintaining $HNT as the ecosystem’s backbone. This modular structure supports multiple networks while ensuring economic alignment through $HNT and DCs, which are required for all data transfers.

Helium’s 5G network under the Mobile SubDAO emerged as a key growth driver. The Helium Mobile hybrid carrier, combining decentralized 5G hotspots with T-Mobile infrastructure, quickly reached 90,000 subscribers. Partnerships with companies like Telefonica further expanded its reach, targeting large markets like Mexico with over 300 million potential users. These efforts diversified Helium’s revenue streams and reduced its dependence on IoT.

Managing multiple SubDAOs and maintaining sufficient operator rewards remain challenges, as does competition from traditional telecom providers and other decentralized networks. Helium’s transition to a "network of networks" addresses these hurdles by integrating diverse wireless technologies, expanding market reach, and unifying its ecosystem around $HNT. This shift positions Helium to meet a broad range of connectivity needs while scaling its decentralized wireless infrastructure.

Here’s a good way for you to understand on a high level how does the user <> helium <> subdao economy operate and look like:

The IoT SubDAO

The IoT SubDAO manages Helium’s original LoRaWAN-based network, launched in 2019, to provide low-power, long-range connectivity for IoT devices. This network supports applications like environmental monitoring and asset tracking through community-owned hotspots. Operators earn IOT tokens, which they can stake for governance rights (veIOT), burn for DCs to use the network, or exchange for $HNT, ensuring alignment with Helium’s ecosystem.

Here’s a very good understanding about how does the IOT network work:

PoC validates hotspot locations and coverage reliability, using a challenge-response system where neighboring nodes verify transmitted data packets. This decentralized approach eliminates reliance on centralized servers, reducing costs and improving security. Operators earn IOT tokens for participation, incentivizing network growth.

The IoT SubDAO faces challenges such as limited growth in IoT applications, leading to low data transfer demand and reduced revenues for hotspot operators, despite nearly a million hotspots deployed.

Future growth for the IoT SubDAO depends on the broader adoption of IoT applications that require low-power, decentralized connectivity. Developing high-value use cases and improving network efficiency will be crucial for driving demand and increasing data transfer revenues.

One of the core challenges of IOT subdao are the long term revenue potentials, because of lack of demand.

The mobile subDAO

The Mobile SubDAO, launched in December 2023 through HIP 53, manages Helium’s decentralized 5G network. It operates a hybrid model that combines T-Mobile’s infrastructure with community-owned CBRS and WiFi hotspots. This approach reduces costs and expands affordable 5G coverage, especially in underserved areas. $mobile incentivizes hotspot operators, rewarding them based on location, uptime, and demand. The SubDAO independently governs PoC

Here’s a good understanding about how it works:

The hybrid 5G model allows traffic to route through Helium hotspots when available, lowering costs compared to traditional carriers. MOBILE tokens reward hotspot operators based on factors like location, uptime, and demand. Service providers like Helium Mobile must burn $HNT to acquire DCs for subscriber connectivity, ensuring the broader Helium ecosystem benefits from the Mobile SubDAO’s growth.

Helium Mobile as a carrier

The average cost of mobile data worldwide is approximately $7.29 per GB. With the typical user consuming around 20GB of data per month, this translates to a significant expense of nearly $150 monthly for data alone. These high costs highlight the burden on users and underscore the need for more affordable alternatives like Helium Mobile.

Helium Mobile, a $20/month plan launched by Nova Labs (parent company behind helium), has reached almost 120k subscribers in its first year by leveraging cost savings from hotspot offloading.

Its pricing has been able to challenge traditional carriers, showcasing the hybrid model’s viability and encouraging future adoption by other providers.

Here’s a breakdown of the offering by Helium:

How does it compare to the web2 players?

Offload partnerships and expansion:Helium is partnering with major MNOs like Telefonica in Mexico and U.S. telecom operators to offload data traffic. These partnerships target markets with over 300 million potential users, driving DC demand and $HNT burns, which support network scalability and revenue growth.

Revenue impact

So, it would make sense to focus on the following for driving more growth:

The revenue potential for Helium is immense. By examining the performance of web2 players (shown above in the report), we can better understand the scale of the opportunity and the vast market Helium is positioned to disrupt.

Understanding dynamic coverage & pricing

Dynamic coverage is a core feature of Helium’s Mobile network, seamlessly combining decentralized hotspots with T-Mobile’s infrastructure. Subscribers automatically connect to Helium’s community-owned hotspots when coverage is available, offloading data to reduce costs. When hotspots are unavailable, devices switch to T-Mobile’s network without interruption, ensuring reliable service.

This hybrid model benefits all stakeholders. Helium Mobile lowers operational costs by routing data through hotspots, enabling affordable plans like unlimited data for $20/month. Subscribers enjoy reliable and cost-effective connectivity, while hotspot operators earn MOBILE tokens for data offloading, driving demand for more hotspot deployments. This feedback loop improves coverage and increases offloading opportunities, reinforcing the network’s growth.

By reducing congestion on T-Mobile’s infrastructure, dynamic coverage enhances efficiency for both Helium and T-Mobile users.

Dynamic pricing for data offloading in Helium Mobile

Helium Mobile employs dynamic pricing to adjust costs for data offloading based on factors like demand, location, and network congestion. This market-driven approach incentivizes efficient hotspot deployment by raising prices in high-demand areas to attract more deployments and lowering prices in low-demand regions to prevent oversaturation.

By combining T-Mobile’s infrastructure with community hotspots, Helium Mobile reduces costs for telecom partners while optimizing hotspot usage. B

Core challenges Helium faces

Helium has grown significantly as a decentralized wireless network but faces key challenges in reward allocation, network participation, and tokenomics that affect its sustainability and growth.

→ Overallocation of rewards during the IoT phase

Helium’s early IoT network allocated fixed $HNT rewards to a small hotspot pool, creating high earnings that spurred rapid deployments. However, as hotspots multiplied and IoT demand remained low, rewards diluted, exposing an imbalance between incentives and network utility. The reliance on PoC rewards during this phase highlighted the need for a more sustainable incentive structure.

As we can see in the graph above helium ranks last in terms the tokens available to keep driving demand, it’s that’s why becoming important for them to now focus even more on the secondary partnerships and introducing more subdaos.

→ Low participation due to limited demandDespite nearly a million hotspots deployed, Helium’s IoT network experienced minimal utilization, with data transfer revenue at one point averaging just $200 per month across the network. This lack of real-world demand led to operator disengagement as PoC rewards dropped. Aligning rewards with actual network usage rather than expansion is essential to re-engage operators and maintain consistent coverage.

→ Exploitation of reward mechanisms

Helium’s PoC system has been exploited by fraudulent hotspots gaming the system for rewards without providing legitimate coverage. This undermines network integrity and reduces rewards for honest operators. Stricter validation mechanisms, penalties for fraud, and a focus on data transfer rewards over PoC could be helpful for having a better ratio of revenue vs token incentives provided.

As we can see above, the revenue has consistently remained below 10% of the token incentives distributed, which is expected given the early stage of the network's evolution. Monitoring this metric will be critical to assess the network's growth potential, particularly in terms of revenue generation (i.e., demand driven by subDAOs). If demand fails to rise, it could jeopardize the network’s sustainability. A lack of sufficient rewards for operators could eventually push the network into a downward spiral.

This should also resonate into the price becoming a function of paying users on the network helping drive the revenue.

→ Token buyback considerationsA potential $HNT buyback plan for mobile operations could boost token demand and value. However, such mechanisms must be carefully designed to avoid centralization risks or market distortions. A well-structured buyback could stabilize demand.

→ Fixed supply constraintsHelium’s fixed $HNT supply of 223M, coupled with biennial halvings, creates scarcity but may limit reward pools for SubDAOs like IoT and Mobile. As supply tightens, incentivizing participation could become difficult without adjustments to the halving schedule or alternative reward structures to balance scarcity with growth needs.Addressing these challenges requires refining Helium’s tokenomics and incentive structures. By prioritizing real-world utility, combating fraud, and aligning rewards with network demand, Helium can sustain its growth and remain competitive in the DePIN space.

Real world use-cases

Helium’s impact on paragliding safety and tracking

Helium has addressed critical tracking challenges in paragliding, offering a reliable, low-cost alternative to traditional GPS and cell phone coverage, which often fail in remote mountainous regions. For instance, in 2020, a paraglider named Kiwi tragically went missing in Nevada due to GPS failure and lack of cell coverage, underscoring the need for better tracking solutions.

Using LoRaWAN trackers like Oyster devices, Helium provides long-range, low-power location tracking that functions even in remote areas. These trackers send location data up to 40 km, leveraging Helium’s hotspots for connectivity without requiring personal infrastructure. In areas with no hotspot coverage, portable Helium gateways powered by batteries or solar panels can be temporarily deployed for flights or events, bridging connectivity gaps. Tests at

This system enhances safety by offering a backup when GPS and cell coverage fail, enabling faster emergency response times. It is also significantly cheaper than satellite-based alternatives, making it accessible to more pilots. Helium’s decentralized network ensures continuous improvement as more hotspots are deployed, benefiting both paragliders and hotspot operators.

Ofcourse, challenges like signal interference in mountainous terrains and the need for internet-connected gateways persist, Helium has helped transform paragliding safety to some extent.

Next up, let’s also look at some of the companies that Helium has worked with over the years and understand the metric that it’s helped move

→ Building and real estate: Automating water metering and billing

→ Agriculture and climate tech: Optimizing irrigation for golf courses

Smart cities: Early flood detection and prevention

Environmental monitoring: Carbon sequestration and climate research

Tracking and logistics: Livestock guardian dog monitoring

Residential roofing: Preventing mold damage in homes

Quick summary of some of Helium’s impact:

Helium’s expansion strategies

What’s next for helium?

Helium is entering a transformative phase, focusing on streamlining its ecosystem, scaling networks, and expanding into new use cases. Key Helium Improvement Proposals (HIPs) help address governance, tokenomics, and technical scalability, shaping the network.

Below is a detailed breakdown of the major HIPs in progress/ recently concluded.

Let’s learn about a few of the recent HIPs as well.

HIP-138: Consolidating the helium ecosystem

HIP-128: Energy subDAO

HIP-132: Scaling mobile mappers

HIP-134: Reward mobile carrier offload hotspots

Here’s the current impact and growth career offloading has shown

HIP-110: Proxy voting

These HIPs focus on simplifying Helium’s operations, enhancing participant incentives, and driving adoption in new areas like renewable energy and global connectivity

Closing thoughts

Helium has evolved into a leading decentralized wireless network, expanding from its IoT-focused origins to include 5G and upcoming protocols like energy and WiFi. By leveraging LoRaWAN technology, strategic partnerships with major telecom players like Telefonica and DISH, and innovative tokenomics, Helium is addressing connectivity challenges in underserved and remote areas. Proposals like HIP-138, which consolidate rewards into HNT, simplify the ecosystem and create a more focused growth strategy—though not without significant risks.

Helium’s impact is evident: it reduces the costs of deploying and operating networks, making solutions like IoT tracking, paragliding safety, and flood prevention more affordable and accessible. Features like dynamic pricing, boosted location rewards, and decentralized governance ensure Helium remains competitive in the fast-growing DeWi space.

Challenges persist, including managing operator rewards, maintaining hotspot engagement, navigating regulations, and competing with traditional providers. However, Helium’s first-mover advantage and ability to scale across diverse DePIN use cases position it as a formidable player in the space.

With a dedicated team that has been building the network for nearly a decade, it will be exciting to see how Helium continues to grow, especially as the market gains momentum. The next year holds significant promise for Helium’s network expansion and innovation.

Hope you had a great time reading as I did about Helium, thanks for making it till here - if you did please enjoy, want to drop any corrections/ suggestions or just chat more about Helium & the broader DePIN space, please do drop me a message on Twitter.

References

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