A Quick Helium Explainer – Helium ELI5

Got a question about Helium? Which miner is best? How are rewards calculated? What antenna should you get? How much will you earn? Where should you put your hotspot?

Here are answers to the most frequently asked questions about Helium, explained for those of us who aren’t super technical.

First, Helium in a nutshell: Helium is a network of computers with built-in radios. This combination is called a “Helium Hotspot.” Each Hotspot (HS) acts just like a cell phone tower processing signals, except they process really small pieces of data that travel really long distances. And, instead of the telephone company (or “telco”) getting paid to put up cell phone towers, YOU get rewarded for putting up a Hotspot.

The term “hotspot” can be confusing. Many people think they’re providing WiFi for others. You’re not. This is a different kind of hotspot providing a different kind of radio coverage, something called LoRa, for Long Range. This radio coverage transfers really small packets of data (like a 10 digit grid location or a temperature, or a wind speed, or whether or not a person walked through a doorway) really long distances, sometimes 20 miles or more.

Depending on where it’s placed (more on that here) a Helium hotspot can transmit and receive signals from 1 km to 300km away , though that is HEAVILY dependent on what’s around it. Hotspot radio waves are blocked by the usual solid things; buildings, walls, mountains.

How are rewards calculated? Approximately 2.5 million HNT are split 6 ways every month.

  • Challengers – 0.95% of rewards (constructed by the Validator group, this initiates the HNT earning sequence for Hotspot owners)
  • Challengees – 5.31% (your hotspot passes on a signal after hearing it)
  • Witnessess – 21.24% (your hotspot hears the signal of another hotspots)
  • Consensus Group – 6% (a randomly selected group of more powerful computers called Validators. You can be a Validator if you have the technical skills to run one and are willing to “stake” 10,000 HNT.
  • Security – 34% (Helium Inc and investors)
  • Data Transfer – up to 32.5% (your hotspots process actual data that come in from sensors.) Realistically, not much data is being passed around yet, so all the “leftover” data rewards is split out between the Proof Of Coverage (Challengers, Witnesses & Challengees) group.

What is a gateway? Is it the same as a hotspot? Yep, a hotspot is a gateway. The Helium network is made up of:

  • Hotspots (aka gateways), which transmit and receive signals from other hotspots and from –>
  • Sensors which are the things that actually generate the data and send it to the hotspots.
  • Validators, coming sometime before early summer 2021,which are basically more powerful machines than hotspots that make sure all the transactions entered into the blockchain are valid.

How much will I make? Short answer is from .1 to 1 HNT/day. Most of you will make less than .25 HNT/day. A reasonable way to estimate what your earnings will be is over here.

Earnings depends on a few things: Location density and how many other hotspots your hotspot can “see”, which is a function of your antenna and all the cabling & connections. Here’s an entire article on optimizing your hotspot placement.

You can also look on the network map at hotspots in your area of interest and see how much they’re making, or use Sitebot to look at how much the hotspots in your city, state, or country make.

What miner is best? They’re pretty much all the same as far as performance. The differences between them are basically inconsequential. You can find all the current hotspot manufacturers listed on Helium’s page. BFGNeil over on Discord has done a superb post on this over on Medium. Read it.

Yeah, but which one is the best? I mean, I want to maximize performance! I want to win! Relax, turbo. WHERE you put it is 100 times more important than which hotspot you have. This isn’t like Bitcoin where one mining setup gives you a huge advantage over another. The best one is the one you have plugged in and singing.

But, but, but, which one should I buy? I’ve bought RAKs, Nebras, and a FreedomFi from CalChip, Parley Labs, and FreedomFi, and Bobcat sent me one to review. I like the RAKs the best, but others have different opinions.

Where should I put my hotspot? Near, but not too near (more than 300 meters) other hotspots. In a high place where it has nothing blocking it from “seeing” other hotspots. Read this article on optimizing your hotspot placement.

What antenna should I get? You won’t believe this at first, but I’ll save you a bunch of time and effort by saying DON’T WORRY ABOUT THE ANTENNA. Unless you live in a place where you are 5+ miles away from the next hotspot, the antenna you use won’t make that much difference and may actually hurt your earnings.

Yeah, but…I want the BEST antenna. I have TWO HUNDRED DOLLARS to spend! I want to make the MOST money. Ok, ok, relax. Read this article on how to match your Helium hotspot placement with your antenna. Buy any of the antennas from McGill. That’ll probably make you feel better about your hotspot, but unless you’ve already done the work to be in a good location AND be up high, well, the antenna won’t make a huge difference.

What about this antenna I found on eBay that says it’ll communicate with satellites/reach across oceans/skip from mountain range to mountain range? C’mon, stop it with the antenna obsession. The antennas shipped with every hotspot are excellent.

Unless you have a very specific use case (a mountain top location with a view of the city and the nearest hotspot is 8 miles away), the fanciness of the antenna has very little bearing on your earnings. Focus on finding the right location & elevation. Trust me, I’ve installed that antenna. It’s not going to be the most profitable setup.

What’s the furthest a Hotspot can reach? Typically they’ll do 5-15km easily. The LoRa record is (or at least was) held by the guy with the Swiss accent, which is a great video to check out. Current world record (not by Andreas Spiess) as of March 2021 is 517 miles. Yeah, it goes a long way. No, that wasn’t a stock antenna.

Is Helium available in my country? Probably. You’ll need to take a look at what frequencies are allowed to be transmitted on in your country. As examples, in North America it’s on 915 MHz, in India it’s 865-867 MHz, in Europe it’s 863-870 MHz, in South Korea 920-923 MHz, and in Asia 923 MHz.

Do I have an advantage if I have the first hotspots in a town/state/country? Only until other people start putting in hotspots. There is no “first placement advantage” for putting hotspots, other than that you’re mining and other people aren’t.

Is it secure to put a Hotspot on my network? Generally it’s about as safe as adding a printer to your network. Here’s Helium’s official Security explanation. One important point (brought up by @para1 in the Discord channel) is that the antenna is NOT a WiFi antenna, it’s a LoRa antenna, and if you can hack into a network through LoRa, well, you’re probably working for OGA.

Will a Helium Hotspot be able to penetrate low-e glass? Yes, but the signal will be dampened. It’s always best to get your antenna outside and up high. More on that here.

Will I make more HNT if I put 2 Hotspots in my house? No. Unlike Bitcoin, where more horsepower equals more earnings, Helium Hotspots are rewarded for how much *unique* AND *provable* coverage they provide. If you have BOTH those things, you’ll make the most. If you have just one (lots of provable coverage that is duplicating other coverage, or lots of unique coverage where no other hotspots can communicate with you), you’ll earn far less. If you have 2 or more hotspots, the best way to earn the most is to place them at least 300m away from each other and have each provide as much unique & provable coverage as possible.

What is PoE? PoE stands for Power Over Ethernet, and it’s a way to power your miner using just an ethernet cable. For PoE to work, you’ll need a PoE Injector to inject power into your ethernet cable. Depending on what hotspot you have (Nebra Outdoor doesn’t need it, the RAKs do), you may also need a PoE Splitter to split the power out from the ethernet cable.

How long before a Hotspot that’s offline stops affecting my reward scale? Technically, 3600 “blocks“. A block is about a minute, so 3600 of ’em add up to 60 hours, or about 2.5 days. That’s continuously offline; if it pops back on for even a block it’ll still show up. You can read about that in HIP 17 and check the appropriate chain variable, titled hip17_interactivity_blocks, here.

Where can I learn more? Join the Gristle Crüe, we have weekly calls to talk all things Helium and you get early access to interviews with key players.

24 thoughts on “A Quick Helium Explainer – Helium ELI5”

  1. Halving and Sharing.
    OK, so ive figured out Placements, hights, line of site, density and creating a nice grid where i live so that most of the hotspots can see each other. 80% happy with my effort so far.
    I understand the Halving is coming and im still happy that i can get this.
    BUT, just spoken to a friend and he informs me that the 5M tokens that go toward building the network will soon be going to all the new hotspots that people are about to take delivery of as well as the existing units. So theoretically speaking a unit making 100H today will be 50 at the halving, then with the dilution from the 175k extra hotspots (8times as many overall) getting delivered could become 6.25H.
    100/2= 50 (halving)…… 50/8 (Sharing)=6.25
    Have i got something wrong here, I do hope so as i dont want my Balloon to burst.

  2. Thanks for the quick reply Nik.
    So the placement plan i had cobbled up was mainly over the residential areas where i live. There isnt much in the way of industry for a few miles so im guessing not a lot of action for the network to process.
    Would i be better off looking to cover industrial areas with major Motorways/freeways passing through them ? Im trying to square this off properly in my head and place the units in areas with plenty of £££ traffic. Maybe in the beginning coverage was the main game but could that morph into data hits becoming the earner. Im in the UK by the way.

  3. Unless you’re processing a boatload of data traffic, remember that one of the fundamental offerings of the Helium network is that data is cheap. In order to max the opportunity, you’ll have to figure out a way to actually help local gov/biz/entities USE that data, then charge for that.

  4. Hi! I have 5000h land and I want to cower with hotspots. No city around. It’s a good idea to invest in it? Thans

  5. Hi Bartok, potentially good to invest in, but with no one around you’ll be taking a fair amount of risk. You’ll need at least 26 hotspots to build out an area that has the potential to earn, and all of ’em need power (easy) and connection to the internet (which can be tricky.)

  6. Thank you for your quick answer Nik, I really appreciate that! I’m about to deploy around 500 hotspots. For the power and internet connection is not a problem, all that is already fixed. So you think that I can go with this project? Thank you

  7. Hi Nik,

    I just read your great articles. I’m studying this HNT coin while waiting for arrival of mining machine.

    I think your articles will be very useful for the people who are living in my country, S. Korea, even though I live in Canada now. Because there are not enough HNT information written in Korean language. May I translate your articles into Korean language and post them on my blog? I’m neither professional translator nor business person. I have 15 years semiconductor marketing experience in global company and I’m student now. Therefore, I’ll never sell the translated articles. It’s purpose is just for sharing the valuable information of HNT coin to the people who speak Korean language.

    Please let me know your opinion.
    Thank you.

  8. Hey Nik,
    I’m from Maldives and so far only 3 hotspots show in the central area of the country (near capital city) since I’m from the most southern island I’ll be the only one with a hotspot if I do invest in it. Would it be a good idea to buy 2 miners to put up in a distance or will I earn if I just put one up?

  9. Hi Yafis, you’ll want at least 2 if you want to earn at all, and really, you want more like 30-40. The good thing about the Maldives is that signals travel far over water, so your 30-40 can be spread out. Just get those antennas high!

  10. Hi Nik, very useful all your articles.
    Looking at Helium Explorer, I can see the most valuable miners have 7D Beacons very high, and they are making 20-35 HNT per month.
    To achieve those high earnings, is there anything I can do, besides placing the antenna in a high place with good view? Where I live, in Spain, I can put it on the roof of the building, around 30 meters from the ground. Can I do something more?
    In my place, I have 2/3 miners in my hexagon. And I see miners doing 2-3 HNT/month and anothers 20HNT/month.

  11. Hi Dave, once you get it high there’s not much left to do. It’s all about line of sight to multiple other hotspots (60+). If you have that, you tend to earn well.

  12. Hi Nik,
    I’m waiting for my miner hotspot from linxdot. I was planning to install it on a place that no other miner was on this hex
    Now this hex has 1 hotspot 🙁
    Is it wise to install it there ?or can I use a type of spoofing to cheat the network
    There is available hex next to mine
    P.s :you are amazing dude


  13. Hi Elias, take a look at the “Why Am I Getting Scaled?” blog post. I wouldn’t advocate cheating of any kind on the network. At the end of the day you get rewarded the most for providing excellent coverage; THAT’S where I’d put your efforts.

  14. Hey Nik, I was wondering what is the best system to use to record all of your daily earnings on all your miners through one program I currently have three unit running and have 6 on order.

  15. Excellent information and presentation. I work on commercial roofs, all kinds, retail. office and industrial. What kind of services does the Helium network offer? It would be an easy sell for me to get these on roofs, lots of roofs.

  16. I live in Hot Springs Village, Arkansas I don’t see any hotspots on the map.
    Would it be advisable to be the first in a location?

  17. Hi John, if you can put at least 4 up that all clear line of sight to each other that’ll be the bare minimum to start earning. 1 on its own won’t earn very much at all.

  18. Wow Nik, you are a popular guy around here! Do you offer one on one help? I live in an area with a rapidly growing population but from the maps I don’t see any miners. Just kind of curious as to your opinion on setting up a few in my area and would also like to pick your brain a bit.

  19. Do you know why Deeper HNT “miners” aren’t part of “The Network” but earn HNT rewards? Take a look at the ones in Fallbrook, CA, just north of Pala Rd. They only witness each other. Curiously, you don’t see Deeper miners in large metro areas either.

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