Is Helium Mining Worth It?
DISCLAIMER: This article is for educational purposes only, not definitive financial advice. Please always do your own research (DYOR) before making any high-risk investment.
In little more than two years, the Helium community has built the world’s largest IoT network. It’s one of the most successful projects powered by cryptocurrency that actually provides real world utility. Nearly 900,000 Helium hotspots cover much of the globe today. That said, is Helium mining done and dusted? Is Helium mining worth it? The answer is: It depends.
There are many things to consider if you’re looking to enter the Helium market, especially now with exciting new initiatives on the way. Like any investment, there are short-term and long-term considerations. The trade-off can vary depending on several factors — from your location to profit expectations and your personal reasons for mining. At the end of the day, it’s up to you to weigh the pros and cons, and determine your appetite for the risks involved.
To give you a bird’s eye view of what you may be getting into, here are some factors you may want to consider before jumping into the Helium space.
Con: Like anything in crypto, it involves speculation and unpredictable market cycles.
Crypto is an extremely volatile space. In fact, it’s going through a winter cycle as of this writing. But if you examine the history of Bitcoin, what goes up must come down and vice versa. This is not that far off from how the stock market works. But because the crypto space is a newer invention, it naturally comes with more speculation than traditional economies. Before investing in any project, it’s crucial to evaluate and do your own research (DYOR).
The risks are high no matter how established a cryptocurrency may seem. Case in point: the downfall of Luna and TerraUSD. These tokens were, at one point, some of the most hyped coins in the crypto market, attracting strong support from both wealthy investors and day traders. That is, until it crashed suddenly in May 2022, due to questionable moves in large-scale selling by its backers.
However, it’s important to note that this is where Helium differs from projects like Luna and TerraUSD.
Helium is founded on a service that’s usable and ubiquitous. You’re simply purchasing a piece of hardware at a reasonable cost, similar to buying a wireless router to connect to a traditional Internet service. It’s a one-time purchase that supports the wider community: when you plug and play the device, you help build the network and get rewarded with crypto tokens in return.
No lock-in, no staking, and you’re free to disengage at any point.
Pro: By providing coverage, you actively raise Helium’s value and usefulness in the real world.
The value of Helium lies in its real world utility. You aren’t buying company shares or assets to put into a vault — you’re an active contributor.
When you deploy a Helium hotspot, you’re extending the Helium network’s coverage, which increases its usefulness (and thus value) for real world uses. This pays for the service and makes HNT itself more valuable through its tokenomics. It’s also within your grasp to increase the value of the network by promoting its usage. This is important for pushing the next phase of Helium. People outside of the ecosystem are beginning to understand just how amazing it is to have access to an extensive network through inexpensive, low-power sensors.
You may have seen the increasing number of “New Network User” tweets from Helium, which highlight early pioneers like WeatherXM, Hivemapper, DIMO and others. But we haven’t even scratched the surface of what’s possible. Do you know how to code or have ideas on where low-cost sensors could help? If your answer is yes, then you’re ready to get started. Funding is even available through organizations like the Helium Foundation, Solana Labs, and Borderless Capital to name a few.
Knowledge is the tide that raises all boats. Ultimately, as coverage providers and members of this project, it’s up to us to educate others about what the Helium network can do.
Pro: Helium isn’t just a wireless revolution, it’s a community.
Helium offers real-world utility. It’s not limited to mere financial speculation. Having created the world’s largest accessible wireless network, it provides solutions that benefit all kinds of people. This includes businesses, entrepreneurs, IoT developers, and individuals just like yourself. For example, some companies like Nestlé, Lime, and InvisiLeash use the network to keep their products or operational vehicles connected to the Internet. This is what makes Helium a community — its users are its operators.
Helium isn’t just a digital product that passively exists on the Web. It’s meant to be used by everyday people, which is why accessibility and low-cost usage are at the forefront of its design. These values have translated into rapid network growth and an engaged global community. Every day, more people are discovering how they can personally leverage the network in their everyday lives, projects, and businesses.
If people are using the network, it means they’re personally invested in its growth. This encourages open dialogue among users, fosters innovation, and makes it easier for Helium to gain support for new projects.
Pro: Helium is still in its early stages.
While we already have 900,000 hotspots deployed across the globe, the Helium network is still in its infancy. To facilitate a macro economic understanding of this project, let’s first consider that Helium’s market cap is currently at 1B.
Since Helium’s main objective is to be a network provider, it’s comparable to private telco companies that currently operate. As of writing, the combined market cap of the top ten telecom companies is over 800B.
In other words: Helium still has tons of room left to grow.
Pro: Helium rewards utility in the long run.
In order to build a valuable network and increase the value of HNT, rewards need to be given to hotspots that provide real utility to the network. Right now, most of the emitted HNT tokens are rewarded to miners that extend coverage. A deployed Helium hotspot can provide proof-of-coverage simply by being seen by other hotspots. For that alone, it can already be rewarded with HNT.
This reward emission will be reduced over time, but the rewards for the Network Data Transfer will continue to increase. In the long run, more than 70% of the tokens emitted will be rewarded to devices that provide good, stable coverage and data transferring.
Con: Some areas are oversaturated, resulting in a slow return on investment (ROI).
Helium’s rapid growth is a double-edged sword. On one hand, it shows that the network has legs — its capabilities and community support will keep it operating for a long time. But on the flip side, this also means it’s oversaturated in certain locations and users are competing for rewards.
In order to reap optimal rewards, you’ll have to deploy your miner outdoors. It’s ideal to place it at the maximum possible height. Many users opt for a rooftop or even trees, if they can get away with it. This ensures an unobstructed signal and good visibility.q
It might not be worth getting a miner if you live in an area where many other Helium hotspots already operate. Consider using the Helium Explorer map, which can show you the number of hotspots contained in hexes. The more hotspots your device is surrounded by, the less your own device will be able to mine.
If you’re looking to mine Helium, it’s best to consider underserved locations where your contribution will be more valuable. This will help you break even faster on your hotspot purchase, which is the first investment you need to make to join the network. Normally, a Helium hotspot will cost you a couple of hundred dollars. This may or may not be a big investment, depending on your capacity to spend, but earning that back in HNT tokens will likely take some time.
Helium mining is not an overnight get-rich-quick scheme. It’s a simple way to get into crypto without any trading knowledge. As soon as you deploy a hotspot, you start getting HNT rewards. This lets you diversify your investment portfolio by accumulating one token in an easy plug-and-play way.
Pro: The network is entering a new era with Helium 5G already being rolled out.
Lastly, Helium is an active project with long-term developments. It’s a great time to join as the network is entering a new phase. Chapter 2 of the network focuses on 5G. And remember: 5G in the USA is wide open with far less range than LoRaWAN®. This means that the Helium 5G network will require more density — a higher number of hotspots per location — than the LoRa network. Besides that, new native tokens like $MOBILE are also being launched, with a few more on the way.
Helium network continues to develop and mature its infrastructure at a breakneck pace. Most of these changes are proposed and executed by the very people who are utilizing Helium. With its users as its operators, every new move rolled out by the Helium community solidifies its reputation as The People’s Network.
Helium Ecosystem will continue to operate for as long as its community decides to patronize its service. As the project moves towards bigger and better innovations, it will prove its utility for years to come.
After all the info we have laid out above, will you join the Helium revolution? If you want to learn more about the Helium community, there are spaces where you can observe and speak with users like the Helium Discord or RAKstars Discord.