Author: Killer Whales Source: X, @KillerWhalesDAO
With the #Solana ecosystem resurrected and the #Depin track heating up. As the leader $Mobile, the price surged 10 times in the short term at the end of 2023, reaching a maximum of $0.008.
With the recent correction of #Solana ecological series tokens, at the time of writing this article, #Mobile is currently priced at $0.0027, with the maximum correction being as high as 68%.
Along with the decline in currency prices, doubts about blockchain scams have also begun to increase. So, what are the fundamentals of the Helium Mobile project?
Let’s talk about the conclusion first. We believe that the most outstanding thing about Helium Mobile is that it is a “double flywheel currency price increase model” and matches the “33 pivot points that detonate the flywheel”.
The risks mainly lie in the policy risks of 5G network construction, geographical restrictions in the United States, and possible signal instability among telecom virtual operators.
At the same time, #Mobile’s token chips are too concentrated and are not listed on mainstream CEX, so the price fluctuates greatly.
In addition, the project developer Helium’s last IoT project #hnt was not successful. Many miners suffered heavy losses and also encountered a series of problems such as being delisted by Binance. This also affects people's confidence in Helium to start a new plate to some extent.
1. What is Helium Mobile?
Helium Mobile is a decentralized 5G operator that uses tokens $Mobile to encourage network operators to deploy and operate 5G mobile network hardware, thus forming a decentralized wireless network (DeWi).
$Mobile is the Helium subDAO governance token, aiming to achieve separation of governance.
We all know that the biggest cost in 5G network construction is the construction of base stations. Helium Mobile cleverly uses the economic incentives of tokens to encourage individuals to purchase router-like hotspot facilities and deploy them in various indoor and outdoor environments.
To put it simply, it means mobilizing the power of the masses to replace large base stations with countless scattered small hotspots. This results in lower construction costs, more complete and wider network coverage, and cheaper telecom package rates.
2. Double flywheel currency price spiral upward model
First of all, Helium Mobile is a POW mining coin. Like #btc and #fil, traditional POW mining coins have a "mining machine-coin price" mining coin flywheel effect (see Figure 1).
The money from selling mining machines can be used for market value management. Drive the price down.
Then, as prices rise, mining profits increase, which will attract more people to deploy mining machines.
As a result, the mining machines were further sold, and with more market-making funds, they continued to pull the market.
At the same time, after the mining currency flywheel starts turning, the mining machines will be sold well and the currency price will rise sharply, which will attract more retail investors in the secondary market to increase the currency price.
After the flywheel starts to rotate, you can step on your left foot and right foot like this to spiral upward.
In the past, mining coins, whether #btc, #fil or #hnt, were all raised in this way.
In 2021, #fil increased 10 times in a quarter, and #hnt increased 100 times in a year.
But with only a mining currency flywheel, it can be just an idling bubble. For example, #fil did decentralized storage, but only the mining machines were idling there, and there were no real users at all. And #hnt has a large number of invalid hotspots deployed in China, which cannot be used.
Although #BTC has also started the mining currency flywheel, the reason why it is not at the same level as #fil and #hnt is that it has real usage scenarios: payment and value storage. There are really a large number of people/institutions who use it for settlement and store it as digital gold.
The difference between Helium Mobile and traditional #fil and #hnt is that it not only has a mining currency flywheel, but also a "mining machine/hotspot-user" flywheel (see Figure 2).
The more hot spots in the layout, the better the user experience and the more users.
At the same time, the more users there are, the greater the demand for mining machines/hotspots.
A virtuous cycle.
It is the "double flywheel currency price spiral model".
On the "mining machine/hotspot-user" flywheel, in order to avoid the problem of idling of #fil and #hnt mining machines.
Helium Mobile creatively proposes the principle of determining mining rewards based on usage. Only real users who connect to the hotspot Hostpot and generate data transmission can obtain the $Mobile reward.
If you just purchase a large number of hotspots and idle them there, there will be no reward.
At the same time, in order to guide the layout of mining machines more scientifically and rationally. Helium Mobile also cleverly encourages mobile phone plan subscribers to share their mobile phone location information (Mapping) in order to obtain $Mobile rewards.
In this way, the location distribution of users and mining machines is clear at a glance (see Figure 4).
Project parties can use different token reward coefficients to guide the layout of mining machines.
Hot spots are less rewarding than places with more people.
Where hotspots are less crowded than places with fewer people, the reward coefficient should be adjusted higher.
In this way, it not only completely solves the problem of idling of mining machines, but also guides the layout of hot spots scientifically and rhythmically. It has to be said that Helium has accumulated a lot of experience based on its experience in trading hnt.
3. The 33 pivot points that detonate the flywheel
Helium Mobile is a double flywheel currency price spiral model, and for the flywheel to spin, there must be a fulcrum to lever it.
As for the "mining machine/hotspot-user" flywheel, it has three fulcrums to leverage the user end: price slaughter, seamless connection, and token incentives.
As for the "mining machine-coin price" flywheel, it also has three fulcrums to leverage the currency price side: the double buff of #Solana and #Depin, token deflation, and the ultimate MEME.
These six fulcrums are collectively referred to as the 33 fulcrums of the detonating flywheel.
(1) Price massacre
According to JDPower, U.S. users will spend an average of $157 per month on telecom plans in 2023.
With Helium Mobile's plan, you can enjoy unlimited calls, unlimited data, and unlimited text messages for only $20 per month.
It is quite similar to the crazy attitude of Didi and Kuaiche when they burned money to subsidize users.
(2) Seamless connection
What many of us in Asia don’t know is that North American iPhones come standard with a physical SIM card slot and an eSIM.
To change the telecom tariff package, you don’t need to go to the business hall to change the card like in mainland China. Moreover, number portability has encountered many obstacles.
You only need to download the Helium Mobile APP and set up the eSIM on your phone to seamlessly switch to the Helium Mobile plan.
Another important issue that affects user switching is: What should I do if the early hotspot coverage of the network is low?
Your $20 package is cheap and attractive. But what should I do if the coverage of early hotspots is small, the signal is poor, and the user experience is poor?
Helium Mobile has already planned for this. It has signed a five-year strategic cooperation with T-Mobile, one of the four major traditional mobile network operator giants in the United States.
Helium's own 5G network is combined with T-Mobile's network. When Helium Mobile users are in areas without decentralized wireless network (DeWi) coverage, the encrypted operator will automatically switch to T-Mobile's network.
This fundamentally ensures that if users want to switch to Helium Mobile's tariff package, it will be seamless. That is, there are no inconveniences in use or cumbersome replacement procedures.
(3) Token incentives
As we mentioned earlier, in order to plan the layout of mining machines more scientifically, Helium Mobile encourages mobile phone plan subscribers to share their mobile phone location information every day.
To this end, the corresponding incentive measures will be to reward $Mobile tokens.
At the end of 2023, when the price of $Mobile reached its peak, people even exclaimed, “Recover your money in 2 days and make a net profit in 28 days”!
You subscribe to a package for $20/month, and you only need to click on your phone every day, share your location, and then do whatever you need to do. Helium will reward you with $Mobile tokens worth $10 per day.
After 2 days of use, this package is equivalent to free of charge.
Not only that, you can also continue to use the obtained $Mobile tokens to prepay for up to 3 months of package fees.
This is still very lethal to the Americans who live in dire straits.
Of course, if you are not satisfied with earning 10 US dollars of $Mobile tokens every day using your mobile phone, but want to get more token rewards. Then you need to buy a special mining machine/hotspot Hostpot. The current outdoor version is US$499/unit. The supply exceeds the demand, and it is out of stock as soon as it comes out. The indoor version is still in stock, priced at $249 per unit.
These are the three fulcrums for Helium Mobile to leverage the user end of the "mining machine/hotspot-user" flywheel: price slaughter, seamless connection, and token incentives.
Driven by these three pivots, Helium Mobile has more than 50,000 package subscribers. And this data is still growing at a rate of hundreds to thousands every day.
Judging from the data, it has only been just over a month since the launch of the $20/month package, and it has coincided with the Western Christmas holiday. The cold start momentum is good.
Next, let’s interpret the three fulcrums on the currency price side that leverage the “mining machine/hotspot-coin price” flywheel.
(4) Double buffs of Solana ecology and Depin narrative
In 2023, we saw #Solana rise from the ashes and return to glory. The ecology of this public chain dominated by Wall Street elites is on the eve of a full-scale explosion. The SOL/ETH exchange rate also rebounded 5 times from the bottom.
Helium, as the #Depin project of #Solana’s ecological head, is also one of Solana’s core strategic focuses in 2024.
CoinEx’s previous analysis pointed out that the Solana ecosystem’s focus is mainly on DeFi, Memecoin and DePIN.
Solana’s main narrative is DePIN, which is determined by the founder’s background, ideas and layout, and does not just happen.
Solana founder Toly's longest working experience was in Qualcomm development for more than ten years, including when Solana first raised funds in 2018. The founder also said he wanted to do communications and hardware.
At Solana's Breakpoint conference at the end of October 2023, the case of Helium Mobile was put at the forefront and mentioned repeatedly. In addition, every project mentioned in the conference, such as the silly clothes worn by the founders, had wonderful performance in November, either skyrocketing or announcing an airdrop.
Basically, it is an official project.
Even setting aside Solana's preference, Depin is one of the master narratives of this bull market. OKX Chinese Depin science popularization by @okxchinese "Why is Depin considered one of the most promising tracks in 2024?" 》
In this episode, Helium Mobile is directly used as an example to explain.
And @binancezh also made "How to read the new narrative of Solana Ecology & Depin?" 》's special space, but the whole discussion is also about Helium Mobile.
There is no doubt that Depin is one of the master narratives of this bull market. And Helium Mobile firmly occupies the leading position.
According to CoinGecko data, Helium currently ranks third in the entire Depin circuit in terms of market value. Among the top five projects, three are Solana-based (Render, Helium and Helium Mobile).
(5) Token deflation
For old players who are familiar with Gamefi and mining coins, token inflation and selling pressure have always been a persistent problem.
Therefore, many people will habitually ask about Mobile, if more and more users and mining machines come in, how will inflation be solved? Are there any token consumption scenarios?
This is actually a lack of understanding of Mobile’s token economic model.
Mobile is the same as BTC, the total amount is constant, 250B, and there is no inflation.
Then the annual output is set in advance and has nothing to do with the number of mining machines. And it is halved every 2 years.
There is 50B pre-mining before mining, and then 66B will be added in the first year, 33B will be added in the second and third years, 16.5B will be added in the fourth and fifth years, and so on.
In this case, just like BTC basically produces a block every 10 minutes, the output rate is very stable. Whether you were mining with a laptop 10 years ago or using a professional mining machine now. It doesn’t matter how many people are mining. Its output is fixed and constant every year.
The more mining machines there are, the less output a single mining machine can produce. The incentives for miners mainly come from the increase in currency prices.
Like BTC, there is no need to set any consumption scenarios specifically for Mobile. Whether the flywheel can spiral only depends on whether this story can gather market consensus.
Furthermore, Mobile not only has a constant total amount, it is also a deflationary model. Because both hotspot manufacturers and operators have pledge requirements (to pledge 500 million to become Hostpot Vendors and 50 million to become Hostpot Operators).
(6) Ultimate MEME
Helium Mobile has all the elements needed for an ultimate MEME:
The first thing that bears the brunt is the cheapest mobile plan in North America at $20/month, which is very contagious in itself.
At the same time, even a grandma can understand this - American Telecom has cheap packages, mobile phones can also mine, and if you want to make more money, you can also install hotspots. The imagination is huge.
Finally, the threshold for user participation is 0, and 5G itself is an absolute necessity and has strong ability to break the circle.
ICO can set off a wave because everyone can issue assets.
Defi Summer further enriches the assets that can be issued.
Gamefi is popular because the threshold for issuing and obtaining assets has been further reduced to the point where you only need to play games, and you do not need to understand professional blockchain technology or have any resources.
The reason stepn has become a phenomenal Gamefi project is because the threshold has been further lowered to the point where anyone with legs and the ability to walk can participate.
Helium Mobile takes this game to unprecedented extremes:
The participation threshold is 0 and there is no technical threshold. It doesn’t take any time, mobile mining only requires sharing your location. Hotspot Hostpot mining only requires plugging in a network cable.
Moreover, the 5G network itself is an absolute necessity for everyone.
4. Possible risks
Although Helium Mobile is quite sophisticated in the overall project design, the project party's resource integration and operation capabilities are also relatively strong. But in the early stages of the project, there are still many risks.
First of all, the biggest risk still comes from policy risks. 5G network construction is a strategic infrastructure in any country. Especially in the United States, there are complicated regulations involving multiple departments. Although Helium Mobile has grasped T-Mobile's thighs in a timely manner, it may not be a big problem in the early stages of the project, but as the scale grows, this may become a potential minefield.
At the same time, it is also because of the strategic position of 5G construction. No country will easily let a foreign company carry out 5G construction. Therefore, Helium Mobile will be limited to the United States for a long time.
In addition, Helium Mobile and T-mobile have signed a virtual operator agreement. Virtual operators have emerged in China for a few years, but have disappeared due to various problems such as unstable signals and inadequate services. These problems encountered in the past may still be obstacles for Helium Mobile to focus on customer service in the future.
Finally, the last IoT project #hnt by the project owner Helium was not successful. Many miners suffered heavy losses and also encountered a series of problems such as being delisted by Binance. This also affects people's confidence in Helium to start a new plate to some extent.
At the same time, the FDV of $Mobile has reached 0.7B, but the token chips are too concentrated and are not on mainstream CEX, so the liquidity is poor.
A high market value, a highly concentrated chip structure, and weak liquidity are combined with an old banker with a long history of criminal records. All indicate that the price fluctuations of $Mobile will be relatively large for a long period of time. Investors must control their positions and timing of entry.
Conclusion
To sum up, Helium Mobile's own project quality is good. Its "double flywheel currency price spiral upward model" + "33 pivot points that detonate the flywheel" make people full of expectations for its performance in the bull market. However, due to policy and technical risks, it may ultimately prove to be just another epic Ponzi.
