Amir Haleem (CEO, Nova Labs & Founder, Helium) talks with Austin about the Helium story and the current proposal to move Helium to the Solana blockchain.
0:00 - Introduction
1:05 - Origins of the Helium network
5:24 - Early challenges for Helium
7:19 - Helium’s unique growth and economic models compared to other blockchains
11:35 - The geo-specificity of Helium’s rewards
14:18 - Why Helium started on its own L1
16:55 - Current disadvantages of Helium running on its own L1
20:46 - Why the time is right for a Helium migration
24:28 - Why Solana is the best scaling solution for Helium
28:56 - Composability as parts of the Helium network move off chain
30:57 - Solana’s role in supporting amazing applications
32:12 - How a migration will help Helium reclaim its internal engineering power
34:36 - How the upcoming vote will impact Helium validators and hotspot operators
36:27 - How Helium’s migration will open up the Solana ecosystem to its community
37:36 - Recent developments in cellular networks
41:59 - How long will Helium’s migration onto Solana take, and what will it entail?
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Austin: I'm Austin. This is the Solana podcast. Today, we're talking with Amir Haleem, the founder of the Helium network and CEO of Nova Labs. Helium since its beginning has operated its own layer 1 blockchain, but in a process set forward several months ago, and which has sort of come to a community governance vote in HIP 70, the network is actually proposing switching from operating its own layer 1 to operating on another layer 1. Uh, in the details of HIP 70, the core developers and core contributors are recommending a move to the Solana blockchain as the new home for the Helium network. So we're gonna talk a bit about that today, some of the history of Helium, and how the network, uh, sets itself apart from other blockchains, uh, which is pretty interesting because it's based much more heavily on real world usage and physical hardware, as opposed to simply a software abstraction layer. So, Amir, welcome to the Solana Podcast.
Amir: Hi, thanks for having me.
Austin: Great to have you here. Um, so let's kind of start at the level set here. Um, where did the original idea for Helium come from?
Amir: So Helium has been around as a company, uh, for a little while and we, uh, we always intended to try and build, really, a sensor network, that was the original intention, right? It's like, if you wanted to build a big, broad wireless network designed for sensors, you know, how, how would you do it? . Like, it, it felt clear to us that cellular wasn't going to be the right, uh, solution for things like tracking devices and environmental monitors and things like that. And so we set about trying to build kind of like people have called it an overlay network. I like to think of it as, as more like an alternative network to cellular for small things. Right? Like that's kind of the easiest way to think about it. Um, Bluetooth wouldn't really work for this wifi wouldn't work for it, you know? So we always. Had the intention of like, how do we build something very specifically for these kinds of devices? Um, we had a bunch of friends at the time building startups that needed that kind of connectivity. That was really the thrust of, of why we did any of this. And we, you know, we took a bunch of different turns and iterations of trying to do it in, I don't know what you would describe it as, the web two way, perhaps, right? Where we would spend a bunch of money and we would build the network ourselves. Um, and somewhere along the line, like we just kind of realized that we're we're just like a poor version of AT&T or something. Like we were trying to do, we're trying to do things the same way that AT&T would do it or an existing carrier would do it, except we, we don't have any money, relatively. And so it, it wasn't really until 2017, I, I think, that we started to pay attention to crypto in a more serious way.
Like embarrassingly, like I had just kind of ignored Bitcoin and Ethereum completely up until that time. Like, blockchain just kind of seemed like a buzzword, uh, that didn't make a lot of sense to me. I read the, the like Mastering Bitcoin book and my mind was kind of blown. Uh, and then I, you know, read the File Coin white paper, I think was the first time that we had seen. Kind of a proof of, of work model that like applied to a real thing, you know, it wasn't just, it wasn't just hashing and it wasn't, you know, just some kind of arbitrary use of compute power. It was actually like in file coin's case, if I can prove that I'm making file storage space available, then I'll, I'll get rewarded for that.
And so that was a big thrust for us to like, think about doing things in a different way, was like, okay, here's a model for how you might build a wireless network based on a crypto economic model. Um, and do it in a completely different kind of throw the traditional model on its head or turn it on its head. And that was really the start. Uh, we started building in 20 17, 2018, uh, and launched in 2019. Went from being very small, with 150, you know, deployed devices to close to a million now after, after only three years. So a lot happened in that three years, but that's kind of roughly the, the story of, of how we got to where we wanna be.
Austin: Yeah. So one of the things I really love about that story is it really tracks with, um, on a, on a much larger level, my own journey into blockchain, which is that, um, the utility reason was the reason that I actually first got into the space, which was I was working for a company and they thought the only way they could solve the problem was to build something on blockchain. And it, you know, seems very similar to sort of the way you guys examined a lot of different solutions and decided that that community ownership model is best expressed through, through blockchain. Um, so I think that's a really kind of interesting story. And one of the pieces I really like, I just find funny is I actually joined the Helium community far before I joined the Solana community. Um, I got, I got targeted with one of your ads back in the early days and actually bought, um, a few hotspots in, I think I actually, uh, I got in the discord and argued with Mark for a while about how this thing didn't make any sense and how it shouldn't exist or whatever. And there was no, there was no liquid token. And then, uh, you know, really got kind of, you know, as much used as you can get red pilled by a telco, uh, project, um, you know, really brought into the, the idea that this is really something that has a real interesting application in the real world out of it.
Amir: Yeah. I, I remember you in the community in the early days. I mean, it was difficult at the start, right? Like, especially as a US based company, like, you've gotta be so careful from a regulatory point of view. And, and so I think some of the things that you kind of wanted to say, you couldn't say, and so, you're trying to explain what this was, I think was a little bit of a challenge, right? It's like, "buy this box and stick it in your window and earn this token." And that was kind of where we stopped. Right? Like we didn't, we didn't say anything more about, you know, what, what happens with the token after that, or, or what you could do with it and whether there would ever be a market for it. And, you know, we've been very careful to kind of stay away from all of that. But yeah, it grew like, like wildfire at some point. Like I, I remember at the start, it was very, very difficult to sell hotspots for like 500 bucks. And, you know, we were running a lot of ads are the ones that targeted you. Um, you know, we were giving away like pies and like doing promos for Valentine's day, you know, just said like, whatever scheme you could come up with to like try and get these things out the door, we were, we were doing it. And then at some point he just got its own momentum. And I remember taking, it took off from like 20 or 30,000 hotspots to hundreds of thousands. In what felt like no time.
Austin: It's funny. I, I remember the pie. I, I couldn't remember, but I remember I was like, oh yeah, like you guys mailed me a pecan pie. I think for, cause I bought one around Thanksgiving.
Amir: Yeah. We had pies, we had cookies, literally anything we could think of that would like motivate people to buy the box was what we were doing at the start. And then, you know, you had COVID supply shortage stuff happened and it, it went from like, we're trying to give these things away to like the demand for them was insane and they were selling on eBay for like 10 grand in the used market. So yeah, it definitely been, been crazy to, to watch and a hell of a journey.
Austin: Yeah. So one of the things that, uh, I've always found fascinating about helium is that both the growth model and the economic model are very different than any other blockchain out there. The primary function of a network like Bitcoin or Ethereum or Solana is to be a software platform and to run well. Bitcoin's not a smart software platform in the same way, but Bitcoin is a scarce amount of supply. Ethereum and Solana are smart contract platforms that are designed for other people to build applications and services on top of. You know, apart from the fact that the helium blockchain will we'll get into a lot of the limitations of the existing L 1 right now, but the modeling is, is very different than what you'd see in any other network, because you are both rewarded for providing availability and then also of specific geographic coverage range and proving that you own, you can provide service within that range, and then also passing data through it. And this is one of the things that it took me a while to wrap my head around is like the real value here is on how do you reward the network infrastructure for simply existing and then creating an economic system to meter expenditures on pretty much anything that can be modeled economically as a flow system?
Amir: That was the learning really from looking at something like File Coin, right? Like that they had figured the same thing out, which was that if we can bootstrap the network by rewarding people for making file storage space available, then you can start the flywheel that way, right? I mean, arguably Bitcoin works this way, right? Like, they are delivering block rewards to miners for mining blocks, regardless of whether there are any transactions or like meaningful fees inside those blocks and it's the same, you know, the same kind of flywheel there in the sense, right? You have to sort of create the network first, um, before it can be taken advantage of, and in the case of a wireless network, that's particularly challenging, right? Because there's a threshold that you have to cross before someone really takes the network seriously. And, and by someone, I mean like a user of the network, right? Like a, a UPS or something that's looking to build like a logistics solution can't really consider doing it on a network like Helium until Helium is large enough and the coverage is ubiquitous enough that it works in most places.
You've really got a very, very like difficult ramp at the start. And that's where I think this economic model has been the most powerful, right? The biggest innovation I think we came up with was proof of coverage, where we devised this scheme where hotspots, which are the equivalent of miniature cell towers basically, um, would transmit encrypted packets over the air and other hotspots would receive them, um, and that was kind of the proof, right? Like, are you where you say you are, are you signing things with the right private key? Uh, and that was the reward that's sort of like the Bitcoin mining reward equivalent, right? If you can prove that you are available to move traffic, then you're gonna get some reward for that. And then you're also gonna get more reward if you actually move traffic. And again, if I were to like, continue the Bitcoin analogy, the miners also get transaction fees for whatever transactions are in their blocks. And it's, it's, you know, similar kind of bootstrapping. I think, you know, that's one of the most powerful effects of, of crypto and, and one of the most interesting parts of, of using these crypto economic models is that you really get to bootstrap these networks in this completely different way.
I think when people have tried to build these community wireless networks in the past, it's been this kind of tit for tat model, right? Where you share your wifi network and you can use mine. Um, but that's just not that interesting, right? Like I want, I want to make money somewhere. I, I want to be a telco operator or I want to be an Airbnb host or I want to be a cab driver in the Uber model, you know, those were the sort of breakthroughs economically. And so I think crypto is a way of just sort of decentralizing and democratizing that same, that same effect.
Austin: Yeah. It's interesting. Cuz with the File Coin analogy, you have a similar idea of a resource flow system where you reward both for availability and then for actual storage or in this case passing data. But you guys added, I mean, I'd say two quite difficult components to that. The first is, uh, you know, File Coin operates primarily in consolidated data centers, right? There's not many people running File Coin nodes at home because the economics are such that you really need large amounts of storage availability for that network. But there are penalizations on the Helium network. The rewards you get in New York city, uh, because it's so crowded are, are lower than the rewards you might get in like a, you know, a less dense urban environment. Um, so I think that's a really interesting component too, where you also have to account for overlapping coverage is incredibly desirable up to a certain point. At which point, then it becomes detrimental and you can't simply reward that system. So it's a, it's a much harder system to model than simply data availability where like, you know, an infinite number of replicas is infinitely desirable. There's obviously a diminishing utility there, but for here it's really, um, it's really different. So it's interesting.
Amir: Yeah. It's, it's both difficult to, to model economically, but also challenging to educate, right? Like, because people kinda live wherever they live, and you have to sort of explain to people that, Hey, like being the 5001st, you know, hotspot in the greater New York area, not that useful, right? Like there are 5,000 others that are already there, you know, providing network coverage. And the redundancy is just not useful enough yet until there's, you know, significant amount of traffic. So it's such a new idea to build a telecom network this way that I think we've learned a ton about what users expect and what they do and how they behave. There's so much that can still be done. People are like, oh, congrats on, you know, all the success. And I'm like, it doesn't feel like we've accomplished anything yet. Like we're in, you know, 0.1% of the journey is complete at this point. Um, but yeah, I, I think, you know, our marketing team, especially I think did a phenomenal job of trying to like explain this in simple terms. And I think that was one of the other things that was important that we did well. We made crypto mining available to like random everyday people, right? Like it didn't, you didn't need to be in a data center. You didn't need some crazy like warehouse full of Asics. You know, like you, you literally could just stick this thing on a, on a window ledge and, and get going. And I think that was also a, a, a meaningful innovation.
Austin: So I wanna get into, um, you know, the reason we're doing this call and podcast today and not, you. Four weeks from now, which is the HIP 70 proposal. Um, so let's start maybe with some of the history of Helium actually going forwards and deciding that the right model, at least to bootstrap the network was to build its own L1 and some of the learnings that you've had along that process that make you think now that the recommendation for the community is to migrate to a different L1.
Amir: Yeah. So when we started, I mean, it's important for everyone to sort of think about the timeframe here. Like when, when we started building it was 2017 and um, Ethereum was really the only smart contract platform that you could even contemplate using at the time. Um, I mean, this is so long ago in crypto terms that Anatoly was interviewing for a job at Helium.
Austin: What was he interviewing for?
Amir: I don't remember what the role was, but Solana didn't exist. And he had a, a white paper in the form of a Google doc that was for something called loom. And he had this proof of history idea. Yeah. So that's where we were, right. Just to like, kind of set the landscape. Thankfully he didn't take the job and he went and built Solana, which is, um, which I think was a net positive for, for everyone. Um, But that's kind of where we were, Ethereum was kind of the thing that, that you could use. Uh, and if it wasn't for Ethereum, you're, you're kind of on your own, right?
Like there were some other platforms where you could create a token. I think like stellar, perhaps, and even back then, we were worried that Ethereum would become too expensive. Like we weren't sure how to model the network in a way where the number of transactions was reasonable enough to, to not cost thousands of dollars a week.
Um, and so given that circumstance, we had a bunch of distributed systems guys on the team. We decided to like, build our own blockchain that we didn't fork anything. We just, you know, started from scratch. We, we borrowed where we could. Um, but effectively it is a novel sort of ground-up build. Um, and I think for the most part, it, it sort of did the job that it needed to do. Like, we designed a system that was like maximally decentralized, I would say. Right? There weren't even validators, like the whole network was running on these hotspots, which were raspberry pie powered devices. Like, so literally you had like the whole network was being validated by hundreds of thousands of like raspberry pies, which is in hindsight, really cool, but also in incredibly insane, uh, to, to pull off. And so, you know, the network has grown so much, we've learned so much about the, the decisions that we made we've realized I think a lot of the, the challenges of like being on your own island, right? Like you, you don't have any of the interoperability with, with some of the amazing projects that you see, like Solana, for example, uh, things like wallet support is harder, you know, like trying to get Ledger to adopt you and, you know, like all of those things which are kind of like table stakes for crypto at this point. Exchange listings, defi stuff, NFT, marketplaces, you know, like we don't have any of that stuff because we're like on an island and we're also trying to build wireless networks. And so we don't have time to do it. And so I've come to think of like blockchains as almost like the database or like cloud infrastructure layer of like web two, where you would be insane to like try and build your own sequel database or to try and bootstrap your own data center when you could just use AWS for nearly all applications. There are some cases where that's not true, but for the vast, vast majority, that is true. So now that we're in this sort of new era of, uh, infrastructure and you've got things like Solana, it no longer really makes any sense to like, try and maintain your own L1, given that our mission objective is to build wireless networks. . And that's, I think, just like the simplest way without getting into like a ton of technical detail, that's the simplest way of thinking about it is. There's a bunch of stuff that's very novel and unique about Helium, and none of it is to do with moving tokens around and like validating blocks. And, and so if you can outsource that work, you should. And I don't think we could in, in 2017, uh, but we certainly can now. And, and I, I definitely think Solana is the best place to be doing that work.
Austin: Yeah. And I mean, Helium network to its credit, like, there are very few networks that could do something like run proof of coverage on chain. There's sort of this like strained analogy that you could say to like, you know, to go way back in the day, like Spark, and Sun Microsystems versus like an X 86 architecture, right? Like the, the thing that Helium is good at doing, it's incredibly good at doing and faster than really any other network could deliver that one specific thing. But as you're saying, the Helium network, it lacks any sort of smart contract support at this point, which is the foundation of really all the growth that we've seen in every other network. There's two networks that have that anyone cares about that exist, that don't have smart contracts, they're Bitcoin and their Helium right now. Um, so I think that's a pretty interesting kind of place to, to look at being in at this point.
Amir: And it was a very calculated decision at the time. Like we, we knew the danger of having a smart contract environment. The sort of surface area of potential vulnerabilities was so large. And, and again, like we're trying to build a wireless network, like we're building hardware, we're building apps, we're building block explorers, we're building firmware. It's already a massive endeavor that could reasonably be three or four different companies worth of work. And so to add, like, you know, A smart contract platform and then try and like get integrations across like all of the different things, it it's just too much. People don't scale that way. Right? You need focus and I, I think a big part of the drive for HIP 70 is just for our team, but really the whole community, to get focused on what really matters, which are things like proof of coverage and data transfer and usage of the network and stuff like that. And really, again, not on like block validation or transaction validation and stuff like that, which is again, you kind of need it, but it's not differentiated on, on Helium anymore.
Austin: Looking specifically at, um, why the move is required so some of the things you, you talked about before, that sort of the network is at a place where it's hard for it to keep up with itself in, in some of those operations, but then, um, as you look at expanding into a network that does have smart contracts on it, that that can do more of these kind of features. What are sort of the, the, the benefits, the trade offs, like how, how is that process internally to come to a place where the consensus from a lot of the core developers, both of Helium foundation at Nova was like, it's time to do this thing now?
Amir: So a big part of like, what HIP 70 tries to do is, is also like rearchitect the way the network works. So as you kind of mentioned, everything is on chain today, and that has a lot of challenges in terms of, of how you scale it. Um, you've got a million hotspots beaconing and transactions that have to be validated all the time and, and the validation or the verification of those is reasonably complicated work from a computational point of view, so regardless of, of any move to a different network or a different L1, we had arrived at the conclusion that moving as much of this off chain as we could was probably the right thing to do for now. Um, so we could get the performance up, we could spend less time kind of firefighting the problems and, and really spend more time on like improving things, cuz there's a whole bunch of improvements and, and changes that we always wanted to make, but just had never really had the time to, to get through because of all the firefighting that we were doing. So, that's kind of one component of it, is thinking about like proof of coverage and data transfers being these off chain Oracles as, as we're describing them. Um, and so once you've kind of arrived at that design decision, you you're left with like, okay, what is it that the L1 does? And it, it really is just about, um, moving tokens around, right? It's like the Oracles will tell the, the L1, like, Hey, you, you know, these seven hotspots beaconed and these 25 hotspots witnessed, you need to pay out HNT to these owners. Um, and you, at that point, it's like, why would you maintain your own L1 just to do that? Right? Because you, you don't gain any of the upside of being part of a bigger community, like Solana. Those upsides are things like, you know, decentralized exchanges and this defi ecosystem and NFT marketplaces and, uh, exchange support and wallet support, and, you know, like all those things, uh, that you don't have. And you're still spending like a massive amount of engineering cycles, like maintaining your own L1 when really all the L1 does is move tokens from one place to another. So, really the fundamental design decision is like moving stuff off chain. And once you've done that, it's like, okay, why would you, why would you keep running an L1 if all it does is move tokens around. You should be on a platform where you get the benefit of like being part of this bigger ecosystem.
And one of the other things I'm most excited about that we haven't talked about that much, or doesn't get talked about that much in the community is the ability for like other developers to contribute in a more meaningful way. Right? Like we wrote our L1 in Erlang, which is, you know, a powerful, but somewhat unique and quirky programming language. Um, WhatsApp is probably the, the biggest user of, of it that other people would would've heard of. But in general, it's kind of, you know, it's harder to find engineers that are Erlang people, uh, and it's harder for the community to contribute meaningfully as a result versus using something like Rust or, or being familiar with Anchor and other things on the Solana universe. Like, that will open the playing field significantly and allow more and more people to contribute and, and not be quite as dependent on the core team, you know, to do everything. So super excited about that part of things.
Austin: Yeah. So let's, uh, let's cut to the chase a little bit on this. Why Solana? Why was the recommendation out of all of the different scaling solutions out there, um, and all the different blockchains that this, this could have been the recommendation of, what about Solana felt like the right thing to recommend to the community here?
Amir: There were a few things. And I, I know we're still, you know, putting out this sort of matrix of, of like all the options we looked at and, and how they, how they stacked up. But I think there were a few, like really, really important things. I mean, one was speed, you know, there's something really to be said about the fact that using Solana feels like using a web two app, um, especially in our environment where the kinds of users are not necessarily like typical of a crypto community. Like we have a lot of people for whom Helium is their first and only like interaction point, um, in crypto. And so having things feel like it isn't on a blockchain is, is really, really powerful. Right? So like when you add a hotspot to the network, it's just there, versus, you know, we have to manage these pending states and stuff like that because our transactions take over a minute. So speed is definitely one factor, especially if, when you start to think about the fact that you're kinda sharing this with a lot of other applications.
Um, the choice of, of programming language was also quite important to, to us. So the fact that like Rust is kind of the, the environment of choice, um, in Solana at the smart contract level, I think was really, really important, both because we have a lot of understanding of Rust internally, uh, but it's an extremely popular language with like a big developer community on the Solana side as well. So I think attracting developers and, and sort of further decentralizing core development, um, is important and a popular program language is a big part of that.
There's other more nuanced things like key compatibility, which don't get talked about much. So both Helium and Solana use the ED 25 519 curve, and that doesn't sound like a big deal, but it's hugely important because it means we can, we can map a Helium address to a Solana address without knowing the private key, which means that we can migrate the whole ledger without the user having to, like, intervene in any way. And so we were very, very, very afraid of any process that required the user to intervene or to like migrate their key or like do something because you might end up in this case where like there's orphaned, you know, tokens and like someone's on vacation or, you know, it's just a nightmare scenario. So that was a really huge part of it. And, and strangely there aren't that many blockchains where that is the native address type. Um, so that was a big part of it.
Um, the fact that, you know, the Solana team is very focused on mobile was also a very big part of it. I think Solana is the only network I've seen that has any ambition specifically around mobile and what to do with phones with, with the SMS stack, which I, I think gonna be interesting. The fact that you guys have a phone also kind of interesting, like maybe there's some stuff we could do there where Saga phones are, you know, POC maps on the 5g network, like there's all, there's all kinds of potential crossover there. Um, you know, so stuff, stuff like that, the fact that we, we know the team, well, I think matters, uh, whether that's fair or not, uh, but the fact that we can access senior people, you know, whenever we might need them, I think is a, is a consideration. Um, so in, in general, I think Solana has probably the biggest and most active developer ecosystem and the best support of, you know, the best wallets. Um, and just, you know, there's just a whole range of stuff that sort of fits in that mold that I, I think matters is a great deal, but fundamentally, it's about, you know, speed it's about having a scalable or, or a sane looking scalability roadmap. I, I think those are what matter. And, and I, I think for the Helium folks, it's important to also just be aware that, um, We, we are only sort of relying on the L1 for the token movement part, like all the proof of coverage and all the data transfer is kind of off chain. And, and so, um, the choice of L1, it sort of matters a little bit less in that context, right? Like it's not so much, it's not, you're not trying to do so much on chain anymore. Um, so that, you know, that was also a big part of just thinking through the architecture, but yeah, we've been playing around with Solana now for a long time um, and super happy with it. it still kind of blows my mind how quickly transactions confirm. I, I just love that. I think people are gonna be blown away by, by it as well.
Austin: Yeah. So, as parts of the network, move off chain, what does that mean for like, let's just say I'm a, I'm a, I'm a messaging protocol on Solana. And I would like to, uh, like I know a wallet address that is on a phone that has another messaging app set up. If I wanna actually transmit a data packet over the network, what would that look like from a composability standpoint?
Amir: I mean, it's, it's a really interesting question. Um, there's gonna be sort of a difference between. The physical network, right? So the, the actual sort of air network and what ends up being composable like on chain, and those are gonna be kind of interesting things to watch. Like we, we intend to, to make as much data available on chain as possible without trying to do all the computation there. So any other application that wanted to take advantage of the fact that it was known where a packet was sent, for example, should be able to do that. Um, but they are kind of two different networks. Like one is a physical like air network and the other is, um, the blockchain network for want of a better way of describing it. But there should be a lot of ways for existing Solana ecosystem applications to take advantage of the fact that you now have like a location aware source of data. I'm not sure if there is one on Solana. And certainly there's a, maybe there's a way for step in users to also be POC, like participants on helium. Like why not? Right. They're already out there doing stuff. Um, so there there's all sorts of potential there. And, and I think part of what excites me about platforms, you don't exactly know what people are gonna do with it.
You just sort of give them the tools and they just kind of go off and, and build whatever they need. Um, so I'm excited for that. Just like sort of opening up the creativity and allowing people to like build stuff that, that we don't have to be prescriptive about, I think is a big deal.
Austin: Yeah. It's, it's funny. You talk about that way. That's one of like the guiding principles of how the foundation approaches some of this development as well, which is, like, the role the foundation is to, is to create and invest in base level infrastructure that makes it possible for anyone to build anything on top of the network. Um, and so like, this is kind of exactly what you're talking about, where it's like, if, if the base layer isn't actually, what's integral to Helium's success, if it's the network effect, if it's the ability to, you know, have high availability and meet the uptime requirements of like major clients and users and that sort of thing, then like, why would you focus on that base layer? And, you know, from, from the foundation's perspective, uh, you know, if we're focused on the base layer, why would we build the application layer? And so, uh, it it's a nice, um, you know, there there's that old sort of saying about like, If it doesn't make your beer better, you know, have someone else do it. I think this comes from like Anheuser Bush back in the, in the day. Right. Whereas they outsourced everything except making the beer. And that's sort of that process here of like, as much as you can strip away of what's required to focus on making Helium the best networks it can be. Um, why wouldn't you do that? Yeah.
Amir: Yeah. I, I think, um, that's exactly the way that I've been thinking about it for, for a while now, which is, is, you know, you've got a whole team there and a whole ecosystem that is just focused on making the best possible L1 basically, right? Like, so the whole mission objective, and there's so much for us as a team, but also as the helium community to do on, on the Helium side, um, now being able to just focus on that is, is just gonna be like a gigantic weight of our shoulders. Like if I had to guess we probably spent 60, 70% of our engineering time on L1 related things. Like it may be even more than that, honestly. Um, So, if you think about it that way, like you sort of reclaim like 70 or 80% or whatever the number is of, of your engineering brain power, to be able to spend on things like proof of coverage and reliable data transfer. Uh, and then, you know, from a customer centric point of view, the network gets more stable that way, right? Like we're able to spend more resources on like making the network useful and usable, uh, and less on, you know, block production, basically. Which is a very, very hard problem to, to do well and to do its scale. So I'm, I'm thrilled by the notion of, of being able to just focus on. On wireless networks cause that's, that's really what we're, we're here for. And there's so much good stuff coming, um, that I wish I could talk about today, but gimme another six days or whatever, and we'll be, we'll be able to talk about it.
Austin: Yeah, totally. So when you're looking at things that like users can expect changes for here, I mean, part of it is, is in some ways, not much, right? If you're talking about address compatibility, uh, one day, if this, if this hit passes, um, users will simply have their HNT represented or IOT or mobile represented as an SPL token on Solana, as opposed to being, uh, you know, a token on the relying L1. Um, but apart from that, you know, uh, there's a validator network that's currently maintained on the IOT side of things. Uh, that's not necessarily needed anymore. Um, so there's a whole bunch of like, you know, internal Helium community changes that are also related to this sort of thing. But, uh, you know, one, one thing I guess I haven't heard, talked about much is, you know, the rewards that validators are getting what actually happens to them in HIP 70 once it passes?
Amir: Yeah. Today it's 6.8, 5%. I think of all the H and T that gets created is going to validates today. Um, and they get paid that to effectively run the infrastructure and secure the network. In this model, because we are kind of moving to be an L2 ,uh, and you already have Solana validators at the L1, like we no longer need to like dedicate 6.8% of the HNT inflation, uh, to securing the network anymore. Right? So that's 6.85%, which I think is around 2 million HNT a year at the current emissions rate is now back in the pool, right? Like it's back in the pool that goes to, you know, hotspot operators, for example. Right. So that's another 2 million HNT going back into, into that universe, which, which is a huge win, like you're right. There's not that many people talking about that part of it. Uh, but using that HNT to pay for security is necessary in the current system and not necessary in, in the new design. Uh, so that's a big win to be able to, to get, get that HNT back into their hands of the people building the network, arguably. Um, and then from a user point of view, as you pointed out, I mean, most users on Helium today are using our wallet app, cuz it's kind of the only one that, that I think people trust. Um, and one day you're just gonna open it and you'll still see your HNT balance. It will just be on Solana instead of on helium's L1 you probably won't even notice except for the fact that your address looks different. Uh, but you'll still have your same 12 or 24 words. Um, your balance will still be the same, you know, like nothing really will change from, from that point of view, except the fact that you can now send that HNT to your Phantom wallet, or you can send it to a Serum exchange or you do whatever you want with it really within the Solana ecosystem. But, um, it shouldn't feel, it shouldn't feel like anything's happened other other than everything's faster.
Austin: Yeah. Well, it's, it's funny because, you know, Like there's no defi on Helium at this moment, so this entire world of, you know, yield farming and vaults products and being able to take out loans against a helium balance just doesn't really exist nowadays in that ecosystem. And, you know, small things too, like when the validators were launched, like it's a hard 10,000 token delegation and there's no ability to delegate stake to another validator. Like there is in most other networks. A lot of these pieces seem like they make a lot more sense once the, once the transition takes place and you're able to kind of take these things that important structural developments, but sort of set them aside as saying like they've served their purpose, the network's going into its next phase. We can set aside some of this stuff, reclaim some of those rewards for node operators and kind of keep the, the process going. Um, at the same time you, uh, you know, there's an acquisition of freedom fi that took place as well. Was this sort of, part of the calculus about like, oh, if we're, if we're transitioning L1s, we can free up engineering time to work on stuff that maybe isn't quite as well supported in the world, like hardware.
Amir: Yeah, a little bit. I mean, you know, Helium had spent a lot of time in the IOT universe, so we're pretty well acquainted with that world. Like we understood all the technology, all the hardware, all the protocols, um, you know, we'd experimented with it all over the years. And so we understood the universe of IOT, I think intimately. Um, on the cellular side, you know, even when we wrote the white paper back in 2017 or 2018, like, you know, we had in there that we wanna explore using this same set of tactics, basically for other wireless networks, right? Whether they be cellular or wifi or, or whatever, they may be. Um, and again, just like the sort of L1 landscape has evolved over time, the cellular landscape has probably evolved the most significantly over time specifically because you've got access to, uh, something called CBRS, which is the citizens band radio service.
It's an unlicensed block of spectrum that the FCC made available a few years ago, um, that makes it possible for people like us to run a cellular network in an unlicensed band. And usually that's a huge moat, right? Like you've gotta spend, you know, a hundred billion dollars buying spectrum or whatever, before you can run a cell network. But now there's a pretty decent chunk of Spectrum that you can use, uh, to do that. And, and arguably as importantly, like all the major handset vendors support CBRS, right? So if you have an iPhone newer than an iPhone 11, or you have a galaxy S 20 above or a Pixel 5 or above, um, your handset already works in this citizen's band radio service block of spectrum, you don't have to do anything.
So. Those were two like huge developments. And then, you know, as a result of that, there's a bunch of open source protocol stacks that, that you can now use without having to build them yourself like Magma. And so those were developments that just like, kind of the L1 landscape had shifted like dramatically since we started building Helium. And we had been so busy building Helium that we, we just, quite frankly, hadn't had time to learn what we needed to learn about how to do this in a cellular domain. And so we started talking to the freedom fi team a couple years ago, um, kind of they found us, I think, really because they were building private LTE networks, but had bigger ambitions. They wanted to figure out how to build bigger, bigger than private LTE networks. Um, and so the, you know, it felt like it made sense. They had deep expertise in doing this. They had spent the last two or three years understanding CBRS, understanding cellular, understanding what it took to like negotiate deals with carriers, uh, to operate networks in different environments. Like, they've done a lot in their, in their time, um, and we kind of understood how to do the other part of it, which was motivate the economic build out of a network. Um, so it kind of made sense that way. And, um, but yeah, I think part of it is, is being able to focus now on the network side and not so much on the blockchain side, I think is. It's kind of like a superpower for, for us basically, right? Like we, we can shed ourselves of a lot of attention. I mean, even when you add people, like, you know, your attention is still dragged away when you know, there's firefighting and there's problems and there's things that you want to change. Um, so it's not like you just add more people and the problem goes away. Those people also get distracted by, you know, L1 related things. And so I think being able to, to focus on, on what we do is going to be a, a huge win and freedom fi is a huge part of that because they, they bring with them this, this expertise set that we just didn't have, uh, internally and quite frankly, just didn't have time to, to, to learn.
It's fascinating to think about, um, that perspective too, like if you think of like, uh, like Rakuten in Japan, like they're, they're now a fully software defined cell phone network that's using ORAN and not relying on, uh, you know, single vendor lock in, and you kind of extrapolate that full and, you know, part of the, the success of, I think the helium I OT network was you could take a Helium brain and plug it into an existing LoRaWAN gateway system and suddenly, you know, all these devices would light up and be able to talk to the network and kind of stay online, and you can see kind of a future where, uh, you know, the, the 5g and cell phone carrier network has that same kind of multiplication effect behind it. Um, but you know, I would say that's a, that's a topic we can dive into on another day.
Austin: As we look at like HIP 70, um, you know, if this thing, uh, passes, which, you know, the vote at this point is I think about 81% in favor, um, so pretty strong support at this point in the process, which is, you know, midday, Wednesday, um, what does that actual implementation migration process looks like? Is this, uh, just like an Ethereum merge processwhere we'll see it take three or four years to really come to fruition, or are we talking about a, a much more quick process here?
Amir: I mean, I would love to try and get it done by the end of the year.
Austin: Um, it's a lot quicker than three or four years.
Amir: Yeah. I know everyone listening is probably, yeah. There's no, no chance of that. But, um, I, I think there is a chance of it. I mean, we we've been, uh, already spending quite a lot of time on the Oracle side of the problem, which, which I think is the most complicated part of the equation, which is, you know, moving proof of coverage and data transfer accounting off chain. So sort of like untangling it from the L1. Um, to me, that's by far the hardest part of the problem. And, and as I kind of mentioned, we were heading down that path anyway. So a decent amount of work has already gone in there. So that, that makes me optimistic that there's a chance to hit that.
Um, the Solana side of it, there's still a bunch of work to do there, you know? So, so there's now three tokens in the Helium ecosystem. There's HNT, IOT, and MOBILE. So there's some work around, you know, like how those are emitted and, you know, you need to be able to redeem IOT and MOBILE for HNT whenever you want. So there's certainly work to do on the Solana side as well. Um, but it doesn't, it doesn't feel out of the question to, to me that there's a working version of this by the end of the year. Um, and then there's some migration details to, you know, figure out, but we've already got a pretty good head start on that. Like, I think on a test net somewhere, we have the entire ledger exported and imported as an SPL. Um, so you know, that, like I said, that was a hugely important part of the problem for us, was like, how do we make this like seamless to, to the user? And, and I think we've, we've successfully been able to prove that to ourselves.
Um, there's also gonna be an airdrop of SOL tokens to all the HNT holders, um, so that they can cover, you know, roughly a hundred transactions worth of, of transactions. Cause that was another concern coming outta the community is that, Hey, we need this like, even though it's a fractional amount of, SOL you know, people now have to like ,buy SOL or acquire it and a lot of, again, a lot of our users are not crypto literate in any way. Um, so making that easy for, for people I, I think is super important. So now they don't really have to think about it. Um, and I expect once we sort of introduce them to the Solana world, they're gonna have a field day and start playing around with all kinds of other stuff. Um, but yeah, that, that's kind of where we're focused is like, how do we, how do we make this as seamless as possible? Um, and make it such that, you know, an existing Helium user is just thrilled by the time it's done basically, right? Like POC works better. Data transfer works better. Transactions are faster and they have more stuff to, to do with their, with their HNT.
Austin: Yeah. I mean, I think for, for helium users who are, are listening to this, uh, one transaction on salon is $0.00025 to, to send on the network. So, uh, you know, if you're getting a hundred transactions worth, uh, unfortunately it's not exactly a down payment, but it's definitely enough to, to do a lot of transfers on the network and experience some of the, uh, you know, the fun things you can do in both Solana defi as, as well as just interacting with the ecosystem in general.
Well, Amir, thank you for coming on the Solana podcast.
Amir: Yeah. Thanks for having me look forward to, uh, hopefully being back sometime soon.
Austin: Yeah. We'll have to, uh, have you at Breakpoint as well to talk a little bit more about this.
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