Web 3.0: Something is in the Air decentralized network— Part 2
In the previous article Cracking the hard nuts, we shed some light on the potential breakthrough that decentralization and blockchain technology can achieve. One of those problems is the IoT project challenges with connectivity and Operational Cost.
Bitcoin was unlike anything known before in the financial industry, Ethereum followup offering decentralization of business application by mainstreaming the Smart contract through immutable dapps(Decentralized Application).
Helium is a project that emerge to solve the chicken-egg problem IoT (Internet of Things) continuously faces, it is a new way to look at blockchain, it does not use Bitcoin Proof of work algorithm, It uses Radio Signals to provide proof of coverage.
This article will cover the following.
- What challenge faces the IoT project that limits its hyped potential a few years ago?
- Why LORA and LORAWAN as protocols designed from the ground up for IoT were not enough.
- What makes Helium different than similar projects.
- A practical showcase Helium and connecting a device for the live network.
- Helium future and economics.
Let us crack it down. Building a public communication network is a nutritiously complex problem, usually happening in phases.
- Build a network by setting up gateways to achieve good coverage.
- Distribute compatible devices and register them to your network.
- Devices will send packets, and the billing system calculates the usage of the packets and converts it to credits or bills.
The IoT chicken-egg problem
The devices need the network to run, but the network is huge investment that expect the device to be running to justify it, we can not kick-off IoT project without coverage, and we can not build a network, without devices.
But what is so special about IoT devices that do not make them follow the GSM/3G/LTE approach? The device needs to meet the following criteria.
- Lightweight: tracking device on a smartwatch, animals (wild or pets) collars, a device enclosed in an industrial-grade package placed in the farm or forest.
- Long battery life: surely you do not need to hire an army to go to each device and charge it daily.
- Long-Range transceivers: expect limited Internet access. Backhaul gateways in many use-cases are far from the devices and sensors.
- Cheap in both OPEX and CAPEX: no brainer, but cheap is relative, so we are looking for cost-effective when compared to RoI, imaging a smart plug helps you save the light bulb power, that consumes power to maintain connectivity with the network more than the LED it turns off at night.
How about the cloud cost?
Millions of IoT sensors send a high volume of raw data, which Cloud service providers will provide the storage. These data are later processed and analyzed to extract the business use case.
What is wrong with LTE and WIFI, and why new protocols like LORAWAN?
LTE and WIFI always miss one or more of the previously mentioned expectations. It indeed works in some cases, such as Smart cars and Indoor appliances. An example of a sophisticated application with WIFI is Amazon sidewalk; Amazon sidewalk uses your neighbor's WIFI if your internet is down to keep your IoT devices connected for free :), and indeed uses your WIFI if your neighbor internet is down.
LORA Alliance defines LORAWAN as the following.
The LoRaWAN® specification is a Low Power, Wide Area (LPWA) networking protocol designed to wirelessly connect battery operated ‘things’ to the internet in regional, national or global networks, and targets key Internet of Things (IoT) requirements such as bi-directional communication, end-to-end security, mobility and localization services.
LORAWAN requires four main components.
- End Nodes: devices/sensors which are LORA enabled.
- Gateways/Concentrator: Forwards Radio packet to a Network server using WAN TCP/IP.
- Backend Servers: consist of three components Network Server, Application Server, and Join Server
LORAWAN is a specification. Any company or Telecom provider can implement their network as Cloud(public provider) or Fog (WAN but on edge).
A project called The Things Network pioneered in building a global network, their business model as follows.
- End Nodes, Gateways: provided by vendors and installed by the end-users.
- Backend server: The Things network will implement and provide the three components.
Any Device / Sensor can use the network for Free.
The Things network successfully become one of the largest LORA WAN networks, with a 19.6K gateways installed and maintained by the community in 151 countries, and around a 40Million messages per day, as of the time of writing this article.
Helium Network breakthrough
When comparing Helium network to The Things Network and Telecom, the main difference is the incentive model. Telecommunication operator has the typical business case motivation. Meanwhile, The Things network depends on people enthusiastic about this technology.
Helium adds an incentive model based on Cryptocurrency HNT. Running a gateway makes you eligible to earn HNT. Each HNT has actual FIAT values that HNT can exchange for real earning. Those earning has relatively complex logic behind them. Blockchain contracts, controlled by chain variables, can only be changed by the community voting process through HIP(Helium Improvement Proposals).
Earning split into three main categories
- Proof of Coverage: part of the network and proof your location is legit and witness hotspots around you.
- Consensus: being part of a blockchain consensus group and participating in block validations, even this role is moving to Validators through proof of Stake. Validators are relatively powerful servers rather than the edge gateway.
- Data forwarding: Receiving a packet from Device/Sensor and forward it to LORAWAN Backend server.
So based on that model, owning a LORA gateway at home becomes a way to mine tokens and earn passive income.
Another Major difference between Helium and TTN( The Things Network), the device/sensor pays for the data usage using Data Credit. Data credit is unlike HNT, and it is a credit balance similar to the conventional provider balance.
Check the Helium tokenomics for more details.
Data Credits are a $USD-pegged utility token derived from HNT in a burn transaction and used to pay all transaction fees on the Helium Network. One Data Credit will always cost
$0.00001. Or,$1.00will always buy you100,000Data Credits. But, as noted above, Data Credits are produced by burning HNT. And the market price of HNT will of course fluctuate.
Proof of coverage is the protocol that gives Helium network its unique self-healing nature, owning gateway and HNT earning depends on how well you help the network grow, unlike the traditional Proof of Work used in Bitcoin, having multiple gateways in the same location, will not add any value, it needs to spread on the specific distance to ensure higher coverage.
Helium network is unlike anything cryptocurrency or LORAWAN engineer witnessed before. It brilliantly combines both worlds and provides a unique technical and business case.
Compared to "The Thing Network," helium network coverage grew so fast, driven by tokenomics. At the time of writing this article, there are 466K hotspots compared to 15.6K available on TTN.
The exponential growth of the network makes some start to become skeptical about tokenomics, and if there Ponzi scheme, which is a common accusation for the cryptocurrency economy.
Building Web 3.0 IoT based solution
The following section will build part of an End to End IoT solution based only on decentralized Web 3.0 services. The below design, from initial looks, looks like a conventional IoT solution. Still, all those components are decentralized and provided by nodes running across the globe, by people as their home servers, or even public Cloud.
The below section will focus on Device connectivity. The following articles in this series will discuss storage and Cloud.
To connect a device to the Helium network is very easy, thanks to the hard work of the Helium team.
1 — Go to console.helium.com, register an account upon registration. You will have 10,000 DC, which you can use to send 10,000 Packet, you can run your own console and router, that synchronizes directly through blockchain, but it is a lengthy process that requires relatively high network fees (Data credits), or use helium provided console.
2 — Check if you have Helium coverage in your area. Go to
explorer. helium.com
If you do not have Helium coverage in your area, you have two options
- purchase a helium gateway, it is pretty hard due to high demand and global supply chain issues, only go through helium.com (https://www.helium.com/mine#hotspots), there are tons of scam websites, ensure you purchase a hotspot the comply with your country regulation (https://docs.helium.com/lorawan-on-helium/frequency-plans/)
- Build your Helium gateway, a.k.a data-only hotspot, ensure the band is compatible with your country's regulatory hotspot(https://docs.helium.com/mine-hnt/data-only-hotspots).
In my case, I have good coverage in my area, but I still build my data-only hotspot to get further understanding using RAK2245 and raspberry pi 3. This gateway enables you to access either Helium or TTN, which additional benefits to exploring both networks if you need to switch.
3 — Get your device or sensor. A lot of devices are available. Some devices are turn-key devices with specific use-cases, such as trackers, weather sensors. Others are more into DIY and makers space, such as the Arduino MKRWAN 1310.
4 — Register the device to the helium console. Suppose you are familiar with any IoT platform. In that case, the process is very straightforward, add device, the device manufacturer provides the DEV EUI, APP EUI is something you pick, and APP KEY to provided by Helium console. The device takes 20 minutes to register on the blockchain and become active.
5 — Device or sensors depend on the device itself. The below sample code is the one I am using. It is a slightly modified version of Arduino LORA examples.
6 — Monitor the console and ensure receiving the data and join request.
7- This step varies widely based on the device. You can create a decoder or pass the data directly to the backend helium console supports a lot of integration points. In my case, I used HTTP.
8 — create Workflow is a very intuitive drag-n-drop UI to connect your device to the cloud backend. In my case, I created a node-red flow on the Akash network( a decentralized cloud in the following article)
9 — Create a simple node-red flow that creates post endpoints configured on the Helium console.
10- The device sends data through the LORA gateway, and the gateway successfully route it to the Helium router, show it up on the console and send the traffic to node-red on Akash Cloud
We have a sensor/device connected to a Decentralized network, and this device is hosted on my home but still part of a global network. Any location has helium coverage. The device will work as expected.
Helium Network future, Is Helium a Ponzi Scheme.
WARNING: Do not take any financial decision based on this section. It is based on Helium posts. If you are planning to invest, please consult a qualified person.
Monitoring the current state of Helium Network, it generates more tokens than it burns through data credits, even the DC burns mostly during hotspots assertion and onboarding, the data credit burns through data transfer is very minimal, that is why some people think about Helium network as none viable cryptocurrency utility, and the current HNT market cap is overpriced.
As of 2020, Helium partnered with FreedomFI introduced 5G, a Helium hotspot that can provide LORA and 5G. Also, another network called Deeper network introduced a Deeper-Helium device, a device that offers a VPN and LORA gateway.
Helium made a deal with Actility. Their sensor is also used by Volvo group that use LORA in their IoT devices to roam over the Helium network.
Last but not least, 3G is sun sitting in 2022. Many IoT devices that currently depend on 3G have two options: move to relatively expensive LTE or find another solution with the current state of Helium coverage. Helium can provide an attractive solution.
Helium, since its launch at the ends of 2019, 2020, and 2021 focuses on building the network, 2022 with last news may show increased activity on the packet transfer, and DC burns, still in 2022, Helium has a significant upgrade in its blockchain and network by migrating the hotspots to Light hotspot and depends on validator for Consensus and Challenges.
Building a global network is a long-term project. Helium Inc has 50 years plan. The network usage should pick up in years, not months. What Helium is trying to do on that scale is not a thing that has happened before, making it a potential of Major Success or disastrous failure. The below images are from the Helium Twitter account.
Final thoughts and what is next
Having LongFI Coverage used to be a show stopper for many IoT ideas and startups. Running cost, Helium protocol, and Tokenomics enable the community to build the world's biggest LORA, LongFI network.
If you are working in the area without coverage, having your hotspot (miner) can be a potential cost recovery or even a revenue stream that covers up the running cost of backend service.
Helium currently has its native L1 blockchain in the future. Maybe there is a blockchain bridge with other networks that allow a decentralized exchange of HNT with another network in the ecosystem. This bridge will transform the whole economics of any IoT solution. If the burn rate is high on the network side, it can convert Cloud or Storage Token to HNT and vice versa.
