How Does Helium Mining Work?

With things like cryptocurrency and decentralized systems increasing in popularity, more and more people are starting to look for ways to generate cryptocurrency using this advanced technology. 

How Does Helium Mining Work?

One such method that a lot of people are using to rake in the cryptocurrency is Helium mining – but what is it, and how does it work?

Here, we are going to talk about Helium mining, what it is and how you can potentially build a profit using this new method. 

So – let’s dive in! 

What Is Helium? 

To understand what Helium mining is, you need to know what Helium is first.

Helium is a decentralized network that aims to decentralize wireless networks. It does this by providing long range wireless hotspots to supply devices with Wi-Fi wherever they are, allowing Internet of Things (IoT) devices with a ‘people powered’ Wi-Fi network. 

Helium works all across the world and has been adding more and more hotspots to its network since 2019.

Although this blockchain is relatively new, it is open-source and public meaning that it is open for everyone.

Its hotspots use a LoRaWAN (Low Power, Wide Area networking) gateway which is associated with a single miner, which is usually a small device that is able to run on other devices like Raspberry Pi, making it super easy to use and connect when at home. 

Currently, the Helium network features thousands of hotspots that provide Wi-Fi connection to even tens of thousands devices, making it the largest LoRaWAN network in the world. 

What Is Helium Mining? 

Helium mining is used to refer to the process of providing Wi-Fi coverage, acting as the source of the hotspot.

It always involves something called a miner – which is a small LoRaWAN based device that provides coverage to the LoRa nodes.

The miners connect the notes to the APplication Server and so, the hotspot is functionable and nearby IoT devices can access a Wi-Fi network. 

In return for providing coverage to the LoRa nodes in the miner’s range, the owner of the miner is then rewarded with HNT.

HNT is short for Helium Network Tokens, and it is the native cryptocurrency of Helium.

The HNTs are rewarded to the miner’s owner’s wallet and then can be used as a form of currency. 

So in short, Helium mining works because a device that is connected to another device like a Raspberry Pi provides the coverage needed for LoRa nodes so it can act as a Wi-Fi hotspot.

Without the miners, the network would not work.

As an incentive for installing and running miners, the miner’s owners are effectively paid using the Helium Network’s own cryptocurrency, but this can be exchanged for other forms of money. 

How Does Helium Mining Work?

Helium mining works by connecting a miner to a device like a Raspberry Pi and acting as a hotspot router.

These devices are not just Raspberry Pi as Helium actually has a list of lots of different approved miners including the Bobcat Miner 300.

Once a miner is purchased and set up, it just runs in the background and generates a small source of income for its owner.

How Does Helium Mining Work?

It’s super easy – which is why a lot of people are beginning to mine Helium to earn some money every single day. 

However, some people may try to take advantage of the Helium network and reap the rewards without actually providing coverage and allowing IoT devices to connect to the Internet. 

To combat this, Helium uses an algorithm to validate hotspots and filter out the false miners that do not provide coverage.

This algorithm is called Proof of Coverage (PoC) that uses radio waves to ‘interrogate’ hotspots about their activity and see if they are lying about the services they are meant to provide. 

Proof of Coverage is able to do this because radio frequency features a lot of important properties that makes it a great way to do this validating process including how fast it travels and that it is possible to determine how far away a radio frequency signal came from due to its strength. 

Once this process of validating a miner is complete, the owners are then rewarded with one HNT.

To be rewarded with another HNT, the miner must undergo the interrogation process again and again – and each time it passes, the owner receives a single HNT in their wallet. 

If a miner fails the interrogation, then the owner is not rewarded because the owner is not providing coverage and thus, is not part of the Helium Network.  

This is how Helium mining is validated. 

Is Helium Mining Profitable? 

How profitable Helium mining is depends heavily on your location. How much you get paid in HNT is tied to a lot of factors including population density and how many other miners are in your area. 

So basically, how profitable Helium mining would be for you depends on where you live. 

Some hotspots can earn over $2,000 a month while others earn as little as $1 a day.

When you consider how much you will have to pay for your miner (and this price varies depending on the model you choose to buy) it could be over a year before you start to make a profit through Helium mining. 

If you live somewhere where there are already lots of hotspots, then you will not be adding much to the Helium Network.

Because of this, your hotspot is not as valuable as one in a developing area where you could be the only local miner.

However, if your network is too small in your area, then your hotspot will have very little to do there and will still be less profitable. 

Therefore, the most profitable hotspots are in developing areas where there are smaller but very active networks present – having too many or too few hotspots will lower the profitability of your miner.


So – how does Helium mining work?

Helium mining is the process of providing cover for LoRa nodes in your local area, allowing the Helium Network to have a presence there and supply Wi-Fi to IoT devices nearby.

This means that through using the Helium Network, you can be a part of the process of connecting IoT devices like appliances and light bulbs to the Internet. 

To do this, all you have to do is attach your miner to a device like a Raspberry Pi.

When your miner is set up, the Helium Network will use radio frequency to constantly interrogate your miner, making sure that it is up and running – and each time it passes, you get paid in the form of Helium’s own cryptocurrency! 

However, the profitability of Helium mining is very dependent on your location so if you are thinking of trying out Helium mining (especially now you know how it works), then you can check on the Helium map if your local area counts as a developing and thus a very profitable area for you to make a profit on! 

Colin Faser
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