Helium Proposes Shifting its Entire Network to Solana Blockchain Months After $200M Raise

Developers cited faster transactions and “higher uptimes” among several reasons behind the proposed move.

AccessTimeIconSep 1, 2022 at 7:41 a.m. UTC
Updated Sep 1, 2022 at 4:19 p.m. UTC

Shaurya is an analyst/editor for CoinDesk's markets team in Asia.

Developers behind the Helium network – a grid of medium-range wireless hotspots pitched as an alternative to hard-wired internet service – are proposing to migrate away from the project's own blockchain onto Solana, in pursuit of faster transaction speeds, higher uptimes and more interoperability with other blockchains as key reasons.

The Helium Foundation wrote in a Medium post this week that the new proposal from the Helium core developer team would improve the operational efficiency "significantly."

The proposal to move toward Solana and away from Helium's own blockchain, officially known as HIP 70, "addresses network speed, reliability and scalability," the foundation said.

According to the post, members had spent "countless hours keeping up unprecedented growth" and that reliable "proof-of-coverage activity" and "reliable data transfer activity" have "proven to be a challenge for users." The Helium Foundation said it "fully supports" the proposal, and that it had been under discussions with Nova Labs – the company behind the project – for months.

A Discord call is planned for 4 p.m. ET (8pm UTC) Thursday for Helium community members to discuss the proposed migration to Solana. According to the Medium post, voting opens on Sept. 12 and concludes Sept. 18.

Shifting tokens

The developers propose shifting all Helium-based tokens, governance, and economics around the network’s native HNT, DC, IOT and MOBILE tokens onto Solana. The move would help scale the Helium network, developers said, which has grown to over 1 million “hotspots” in recent months. Helium would also be utilized with ongoing Solana projects, such as the Solana Saga smartphone, developers said.

A key part of Helium's consensus mechanism was said to be unable to handle network demands, which prompted developers to shift away from the Helium blockchain.

The Helium blockchain uses a novel work algorithm called “Proof of Coverage” (PoC) to verify that hotspots are located where they claimed. Put another way, PoC tries to verify, on an ongoing basis, that hotspots are honestly representing their location and the wireless network coverage they are creating from that location.

Hotspots enable anyone to own and operate a wireless network for low-power Internet of Things (IoT) devices while providing coverage for devices using Helium LongFi in return for HNT rewards.

PoC is an intensive and complex program, however, and has “proven to be a challenge for users” in recent months, as per developers. The increased load on the Helium network has caused issues with the transfer of data packets between users.

Scrapping proof-of-coverage

Developers have proposed to scrap the PoC mechanism entirely as part of the shift to Solana – a move that shows the currently used consensus mechanisms on the Helium blockchain were not able to handle network applications in their current form.

Scrapping the use of PoC would help make the Helium network “become much simpler,” developers said.

“Solana is a layer 1 blockchain that focuses on the importance of scalability and speed,” developers said, adding the network does not compromise on security or scalability. Solana has faced uptime issues in the past, however.

The proposal comes months after Helium raised $200 million in a Series D funding round at a $1.2 billion valuation in February in a round led by Tiger Global and FTX Ventures, who joined existing investors Multicoin Capital and a16z. All these firms have previously invested hundreds of millions of dollars in the Solana ecosystem.

UPDATE (15:20 UTC): Adds details from Helium Foundation proposal.

Cameron Thompson contributed to this report.

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Shaurya is an analyst/editor for CoinDesk's markets team in Asia.

CoinDesk - Unknown

Shaurya is an analyst/editor for CoinDesk's markets team in Asia.