Recently, I got my hands on a Helium hotspot, and I wanted to see what this thing does and if it’s actually a viable source of passive income. If you’re not familiar with what Helium is, it’s actually a pretty interesting blockchain project that uses hotspots to create a peer-to-peer wireless network where IoT devices can send data to and from the internet. The hotspots are powered by Helium’s own open-source blockchain technology, so when you own a hotspot you’re actually able to earn Helium tokens, which are a cryptocurrency, as an incentive for letting the public use your hotspot.
Now that’s kind of a lot to take in if you’re hearing it for the first time, so let’s break it down just a bit. In order to understand this we need to first understand what an IoT device is. IoT stands for “internet of things”, and it basically describes physical objects that have a sensor attached to them that can transmit data over the internet. So a smart refrigerator, or a home security system, might be examples of IoT devices. But the tricky part is that things like smart phones and laptops are not considered to be IoT devices. And that might be confusing, but phones and computers are designed for human users with full mobile computing capabilities and lots of other features like voice calls and running different apps, whereas IoT devices are really categorized by performing a specific, low bandwidth task like just reading the temperature from your refrigerator and displaying it. So it’s a little bit arbitrary, but it’s important to explain that here because right now, the helium network is designed specifically for IoT devices. Often-times, IoT devices need to connect and transmit data over long distances where wifi or cellular might not be available, or might come at a high cost. But Helium is able to provide this connectivity through these hotspots, which can cover up to 10 square miles each. They’re able to do this through their technology architecture called LongFi, which combines existing LoraWAN wireless network protocol with the Helium blockchain, which is an independent, open-source chain (not built on Ethereum).
So, just to be clear, this in its current form is not a hotspot that can replace your home wifi. This is a network that connects low bandwidth IoT devices at 200x the range of wifi for a fraction of the cost. But there is a cost, of course, and that’s where the Helium token ($HNT) comes in. So if I’m a user that comes along and I want to use the Helium network for my device, all I have to do is purchase some Data Credits (which have a fixed price in USD) through the Helium Console, and as I use my devices to send and receive data, the appropriate Data Credits will be deducted from my account, so I’ll only pay for what I use. My usage will be recorded in the blockchain, and the blockchain will reward whoever’s hotspot I’m connected to with the Helium cryptocurrency token. That’s a simplified explanation, but if you want the full details on the Helium token economy, their website has a full run-down.
What’s also cool about this is that even when no one is using your hotspot to transfer data, there are still ways you can earn token. Hotspots on the network are randomly assigned Proof-of-Coverage tests to complete, and when your device passes and witnesses tests you’ll earn Helium tokens. There’s also Consensus Groups, and your hotspot could be randomly elected to the group to validate transactions and add blocks to the blockchain, and you’ll earn tokens for that too. So as you can see, this could be kind of an interesting passive income source.
But how many people are even aware of this or using this network right now? Well, the Helium LongFi Network is actually available in hundreds of cities across the U.S., 45 out of 50 states, and covers over 100,000 square miles. SO they’re making some progress, and so far they seem to have the most advanced project for this in the market. There’s quite a ways to go with this still, but it’s a pretty interesting concept because it’s decentralizing the internet provider. That’s why Helium is called “The People’s Network”, because instead of you paying an internet company or cellular provider a high fixed rate every month with data caps and fees, it gives the power back to the people. You pay for what you use, and anyone, including you, can host a hotspot and be a provider. You can look at the codebase, you can build your own devices to connect with, and nobody can cut off your access.
At the time of writing this article [EDIT: see update at the bottom], my hotspot has been set up for about 9 days. The setup process was very easy with the Helium app, and I’ve done nothing else but just let it run to see what happens. So far, I have earned a total of 49 Helium tokens. $HNT is currently trading at a price of $2.46, bringing my total earnings in USD to $120.54 so far. That honestly quite exceeds my expectations! All of these earnings seem to have come from Proof-of-Coverage challenges and witnesses, so it’s worth noting that I’m located in Chicago because some users have reported higher earnings in more populated areas where your hotspot is more likely to be selected to participate in these. Right now, the Binance exchange does support the Helium token, so if you would like to cash in on your tokens you could create a wallet on the exchange and send your $HNT there to exchange for USD or another cryptocurrency. You can also hold on to the tokens and see where the price goes, it has been on an upward trend for awhile now.
Overall, I’m very impressed with my Helium hotspot so far, and I’m excited to continue to follow along with this blockchain project and see where it goes from here!
Update May 2021: The price of HNT rose considerably since I wrote this article and the profits blew my original estimates of around $3,200/year out of the water. I also added a second hotspot, and with the price of HNT hovering around $17 these days, I’m easily clearing about $3,500 per MONTH. I had no idea these hotspot miners would be prove to be so effective! If you’re located in an area where you are in range of lots of other hotspots for optimal earning, I can’t recommend these enough. Most of them have quite long shipping times right now due to high demand and chip shortages, but if you’d like to order one I have a couple of links:
Nebra Miner: https://www.nebra.com/?ref=b8kajgsxpzw8
RAK Miner: https://www.calchipconnect.com/products/rak-hotspot-miner?ref=b8kajgsxpzw8