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Hello!
It’s 7/11, which means anyone brave enough to venture out into the heat at 7-Eleven is getting a free smoothie.
It’s definitely not me, a Northeastern wimp who wilts at any temperature above 85 degrees. Anyway:
Helium eyes energy sector
Last week, the Helium Foundation announced in a somewhat cryptic blog post that it would be unveiling new proposals for “subnets” that would go “beyond wireless.” Speculation about what these subnets would be filled with ranges from location verification to decentralized computing.
The answer became clear this week when Swedish energy project Srcful proposed to become a Helium subnet with its own token, ENERGY.
Helium currently allows individuals to run nodes on their Internet of Things (IoT) network in exchange for Solana-based IOT tokens, which can be converted into HNT tokens. It’s like investing a few hundred dollars in a Helium hotspot and plugging it in, hoping the token payouts will outweigh your electricity bill.
At a high level, the firmware update will allow existing Helium IoT access points to also power Srcful, expanding the utility of the network as well as opening up another avenue for earning token rewards.
Subject to a successful governance vote, Srcful plans to use Helium’s access points to run a virtual power plant. Virtual power plants (or VPPs) are a new idea in the renewable energy space whereby smaller-scale distributed energy sources can be combined to support the grid.
In Srcful’s case, it looks like households offer electricity from their solar panels or batteries (batteries large enough to power a home for several hours) to build VPPs – and receive ENERGY tokens in return.
Helium-based hotspots will be used to “read and control” solar panels and batteries, and hotspot operators will be rewarded in ENERGY tokens.
Srcful would then sell the virtual power plant’s energy (and possibly some accompanying energy data) to customers such as energy companies or grid operators, which would hopefully generate enough revenue to keep the power plant running (pun intended).
If you find this a bit confusing, you’re not alone. Srcful’s complex business model has become a source of concern for some participants in the HIP Discord.
“Here’s the problem, I want to support everything in the Helium ecosystem. However… I can’t even fully explain this to my friends in the solar business,” one user wrote.
Srcful CEO Fredrik Ahlgren told me in an interview that he understands that “it’s very difficult for people to understand” what Srcful does, but he wants to present a more understandable story to Helium community members: “If you have solar panels or batteries, you get rewarded for helping the network.”
Another hurdle is that Srcful has not yet secured contracts with energy-dependent businesses that would pay for its VPP.
“I would say this applies to every DePIN project,” Ahlgren said. “You have to start somewhere. You have to believe there is demand and have product-market fit.”
As Helium considers onboarding Srcful – and presumably other new DePINs – I’ll be interested to see how these subnets solve Helium’s classic tokenomics question.
Helium has a complex utility valuation used to distribute HNT across its networks, and the tokenomics have undergone some changes by the foundation. Despite this, the price of HNT has fallen by two-thirds since February, trading around $3.08 at the time of writing.
— Jack the Cuban
Zero in
Since migrating to Solana in April 2023, Helium has added over 25,000 IoT access points to its network.
However, as this Helium Foundation Dune dashboard shows, the rate of growth in new users has been slowing, from over a hundred per day between December and March to barely a dozen new users per day over the past couple of weeks.
It will be interesting to see if these new Helium subnets will kickstart a wave of hotspot connections. Token profitability will certainly play a big role in this.
— Jack the Cuban
Pulse
History is quite important in the context of blockchain technology. The ability to organize transactions in a precise sequence is key to their immutability. Each transaction is cryptographically linked to the previous one, so changing one transaction would require changing all subsequent ones. However, without proper organization, it becomes easier to manipulate the integrity and reliability of the network.
So, it may come as a surprise to learn that traditional blockchains have trouble ensuring the precise timing and order of transactions. This leads to delays, inefficiencies, and sometimes transactions that erroneously appear to time-travel through quantum space to happen before they were initiated. Creepy.
But Solana does things differently. It uses a method called proof-of-history to timestamp all events that occur on the chain in a verifiable sequence. This allows the network to maintain a consistent and accurate order of transactions, forever and ever.
A recent thread by @bw_solana highlights that there are many misconceptions about PoH in the Solana community. For example, many believe that the primary purpose of PoH is simply a timestamp. In reality, it performs the much more complex task of verifying that the leader’s schedule (the predefined sequence that determines which node will produce the next block) is followed, allowing block production to continue without issue even if the leader fails.
The thread explains that PoH requires nodes to generate a series of ticks, proving that everyone has waited their turn to produce a block. This mechanism prevents leaders from preempting high-priority transactions, ensuring a much fairer order of processing than other chains. Although, of course, some forms of transaction ordering attacks (like sandwiching) can still occur.
It turns out that in order for everything to be cheap, fast and honest, considerable technical knowledge is needed.
— Jeffrey Albus
One good DM
Message from Fredrik AhlgrenCEO Srcful:
