Why Are My Helium Hotspot Earnings So Spiky?

Why will a Hotspot earn well on one day, then noth­ing the next?  Why isn’t there more con­sis­ten­cy in earnings? 

There’s a clear rea­son for spiky earn­ings, and I’d love to walk you through it. 

Let’s start at the begin­ning of the Proof of Cov­er­age (PoC) cycle, with the con­struc­tion of a Challenge. 

Every Hotspot on the Net­work is eli­gi­ble to con­struct and issue a chal­lenge every 300 blocks.  Let’s define “Blocks” and “Chal­lenges”.

A “block” is a unit of time, usu­al­ly around 60 sec­onds.  300 blocks *should* equal 300 min­utes, which of course is 5 hours.  So, a Hotspot can issue a chal­lenge every 5 hours.

Now, *issu­ing* a chal­lenge is not the same as bea­con­ing.  This’ll get a lit­tle con­fus­ing, so bear with me. Under­stand­ing how the PoC chal­lenge cycle works (and does­n’t work) will make the spiky earn­ings much more clear to you in about 3 minutes. 

For you uber-Heli­um geeks, I’m going to slight­ly over-sim­pli­fy this in order to make it under­stand­able. I don’t think we need to get into ephemer­al pub­lic keys and SHA256 digests.  If you DO want to get into that, go here.

The “Chal­lenge” is like a series of envelopes with­in envelopes.  When a Hotspot “issues” a chal­lenge, that means they took 2 secret codes and put them in 2 envelopes so they’re separated.

The Chal­lenger then sends this “enve­lope with­in an enve­lope” to a ran­dom­ly select­ed hotspot on the network.

That sec­ond Hotspot is called the Chal­lengee.  The chal­lengee (and I’ll skim over a bunch of tech­ni­cal stuff here) opens the first enve­lope and uses the code inside to prove that they got the Challenge.

Then they open the sec­ond enve­lope and Bea­con out that code over the radio. 

Any Hotspot who receives (Wit­ness­es) that code then reports that code to the blockchain, effec­tive­ly say­ing, “Hey, I heard code #2.”

The blockchain then checks with the Chal­lenger to make sure all the codes match up and that they were all sub­mit­ted in time. 

If every­body did their job cor­rect­ly and on time (Chal­lenger, Chal­lengee, and Wit­ness), the blockchain issues each par­tic­i­pant a reward based on trans­mit reward scales. 

By the way, if *any­thing* in that chain of events is wonky; if the codes don’t match up, if the whole process takes too long because a Hotspot was relayed, of if any­one is try­ing to game it, the chal­lenge is declared invalid, and nobody earns.

Ok, so how does this explain spiky rewards?

First, remem­ber that any Hotspot can only earn a reward if it par­tic­i­pates in a valid PoC cycle. Invalid cycles don’t count.

Sec­ond, remem­ber that WHERE the bea­cons are emit­ted is ran­dom.  Con­ceiv­ably, all the bea­cons *could* be sent to the US state of North Dako­ta.  Remem­ber, it’s random.

That ran­dom­ness is at the core of why earn­ings are spiky.  Some­times a bunch of Hotspots near yours all receive a chal­lenge, all get to trans­mit, and you wit­ness all of ‘em.  That’s a big earn­ing day.

The next day, none of ‘em get a bea­con, or maybe only a few.  Your Hotspot earns noth­ing, or maybe off only 1 bea­con.  That’s a low earn­ing day.

Since Hotspots are grouped in dif­fer­ent den­si­ties and num­bers around the world, you’re more like­ly (not guar­an­teed) to wit­ness a bea­con if you’re in a place where you can wit­ness a bunch of oth­er Hotspots.

A city with 1,000 Hotspots is more like­ly to receive more Chal­lenges and there­fore trans­mit more bea­cons than a small vil­lage with 4 hotspots. Even though the earn­ings per Hotspot is like­ly to be less in a city, you just have more oppor­tu­ni­ties to witness.

So, that should explain spiky earn­ing.  Got ques­tions?  Hit me up in the com­ments and I’ll do my best to answer ‘em.

Oh, and if you want help mak­ing sure you’re in the best posi­tion to earn the most HNT (not nec­es­sar­i­ly in the city, by the way), con­sid­er join­ing the Gris­tle Crüe, tak­ing a Gris­tle King Course, or hir­ing me for a con­sult.

I’ve helped hun­dreds of hotspot own­ers improve their under­stand­ing and earn­ings on the Heli­um net­work, from folks with just one Hotspot all the way out to com­pa­nies with thou­sands of Hotspots.  I’ve seen most of what you can do with Heli­um and I’d love to walk you through how to make YOUR con­tri­bu­tions as valu­able as pos­si­ble.  Great val­ue equals great reward.  Let’s do this!