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Similarly to Bitcoin, miners are paid by a combination of minting HNT (which halves over time) and fees paid by network usage. I'm very curious to see how this

Similarly to Bitcoin, miners are paid by a combination of minting HNT (which halves over time) and fees paid by network usage. I'm very curious to see how this will play out over time. If network usage / fees don't increase over time while HNT issuance drops, will miners stop mining? Would the revenue still be enough to incentivize long term maintenance? Unlike Bitcoin, if miners stop mining, that directly reduces the value of the network due to a decrease in coverage. Is there a possibility of a spiral, where network usage drops due to reduced network coverage, and then miners stop mining due to the drop in usage? I've not really dug into the details as to what solutions Helium has, but it is quite interesting to see how this experiment will play out.

delabay 5y ago
All great questions. Helium mining is unique in that operational expense is close to zero, once setup, it's actually more trouble than it's worth to turn off. In many cases, turning off literally means climbing a tower. Power and bandwidth costs a cup of coffee a month. Capex is shrinking as the network matures and lower power hardware can do the same job as previously beefier units. A much more realistic risk is sudden insolvency of a specific vendor (who are also responsible for maintaining firmware). There are about 30 approved vendors, growing monthly, but some have a larger share of the mining pool than others. The community is anticipating long term business risks and devising mechanisms to prevent a sudden loss of a large percentage of nodes due to business risk. I firmly believe there is a significant flywheel developing here and I recently left my FAANG job to build in this ecosystem.