Lightspeed Newsletter: Helium eyes the big guys

Howdy!

Web3 is helping pay for both my coffee and my cell phone plan. The latter is the subject of today’s newsletter. 

Who said the millennial lifestyle subsidy was dead ? 

— Jack Kubinec

How high can Helium float?

It’s been more than five months since Helium Mobile debuted its nationwide cell plan, one of the most ambitious applications of what crypto folks call DePIN (decentralized physical infrastructure) to date. 

For $20 a month, Nova Labs, the developer behind the Helium Network, began offering US residents unlimited data plans. 

Helium Network participants run hotspot nodes that emit cellular coverage, and they’re paid in Solana-based MOBILE tokens for operating these miniature cell towers . In places where no Helium data is available, Nova Labs purchases coverage from T-Mobile. 

The product has gained nearly 90,000 subscribers since its launch, including this newsletter writer. Nova Labs CEO Amir Haleem told me these growth numbers are solid when put in context.

“It looked like in all of last year, ATT, Verizon, and T-Mobile only added something like 300-400,000 subscribers combined,” Haleem said, adding that Helium Mobile hopes to reach 300,000 subscribers by the end of the year. 

Publicly available data seems to tell a different story: ATT , Verizon , and T-Mobile each reported millions of new subscribers last year. Nova Labs did not immediately return a request for comment on the discrepancy. 

As a user, I’ll say Helium’s coverage has been as good as any of my past cell carriers. Recently, I enabled discovery mapping, where Helium Mobile pays MOBILE tokens in exchange for location data in order to determine where it needs to create more coverage. On my first day, I earned $0.78-worth of MOBILE — or roughly ½ of a slice of pizza, in New York terms. 

But there’s a question that’s followed the Helium Network for a while now: Can this make money ? Nova Labs added another revenue stream in January when it partnered with the Spanish telecommunications company Telefónica. The company is offloading some of its mobile data in parts of Mexico to the Helium Network. As data usage increases globally, a new network like Helium’s could prove valuable to data providers. 

Still, the sustainability of the network’s MOBILE token-based incentives are something of an open question. MOBILE’s price leapt more than 2,000% right after Helium Mobile went nationwide in December, according to CoinGecko. Helium Mobile has yet to face a serious stallout in subscriber growth, which could potentially put downward pressure on the token price. 

Haleem thinks that the inefficiencies in legacy cellular coverage make Helium an “obvious” application for DePIN.

“It’s just wildly too expensive to keep deploying infrastructure the way it’s being deployed,” Haleem said. “It’s hundreds of billions or trillions of dollars to deploy towers all the time. It doesn’t make any sense.”

— Jack Kubinec

Zero In

The Helium Mobile dashboard from Dune Analytics shows steady growth in newly minted subscriber NFTs, with 89,474 issued since January 2024.

Initially, numbers soared, but enthusiasm flattened somewhat in recent weeks. On May 10, however, a spike occurred with 837 newly minted NFTs. This surge coincides with Helium Improvement Proposal 113, which increased rewards for Wi-Fi hotspots and reduced them for CBRS radios, incentivizing efficient coverage. The spike seemingly underscores the importance of user rewards on growth within the Web3 world. However, sustained long-term interest will likely depend on the quality of services, not just profit incentives.

— Jeffrey Albus

The Pulse

On May 12, Solana surpassed Ethereum in daily economic value, recording $2.25 million in transaction fees and MEV — compared to Ethereum’s $1.98 million. The community has been abuzz since, with vibrant discussions spreading across social media.

In one X thread by Dan Smith of Blockworks Research , users pointed out the milestone’s intriguing timing. Users debated the significance of Ethereum’s L2 solutions, noting that reduced transactions on Ethereum’s L1 could reflect L2s working as intended rather than a decline in utility. This raised questions about whether L2 activity should be included in such metrics.

Mert Mumtaz, co-founder and CEO of Helius and co-host of the Lightspeed podcast, highlighted competitive dynamics, noting how other blockchain projects are targeting Solana developers with job offers. He has been vocal about the potential of Solana’s integrated approach and the limitations of Ethereum’s dominance.

Valuation disparities between Solana and Ethereum also fueled discussions, with some suggesting that Solana’s lower current valuation indicates significant potential for growth. This broader sentiment reflects a belief that Solana could see increased adoption and value as it continues to showcase its capabilities and attract more developers and users.

— Jeffrey Albus

One Good DM

A text from Arman Dezfuli-Arjomandi, a board member at the Helium Foundation:

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