$HNT Nosedives 53% as Community Pushes Back on Helium Governance Proposal

Just one week after the acquisition of its consumer brand, Helium Mobile, at the hands of Andrew Yang, Helium Network is going through some growing pains.

$HNT holders and community members are firmly at odds with the Solana DePIN protocol’s new direction, summarized by a four-part governance proposal.

Making matters worse, $HNT has plummeted over 56% in the past week. Existing holders are in disagreement with the Network’s new direction and the proposed mint of 141M new $HNT tokens.

Helium’s “New Era” Met with Skepticism from $HNT Holders

Helium Network has come under fire from community members and token holders over a drastic economic and organizational overhaul floated in the protocol’s latest governance proposal, HIP-149. Originally published on June 4th, HIP-149 centers around four key changes that aim to support the DePIN protocol’s ongoing expansion:

• Set a floor for deployer earnings

• Capitalize operations and growth through the mint of 141M $HNT tokens over 36 months

• Establish a 7-seat advisory council, with 5 community-elected representatives

• Transition $HNT rewards to an activity-based system, rather than a flat rate for all providers

Helium Network argues that the change is economically necessary to the survival and growth of the network. In Helium’s own words, the network’s “original economic framework was built for a faster carrier-adoption curve than reality delivered”. 

As a result, hotspot deployers were earning more than what carriers were actually paying for data transfer and offload services, meaning that significant adjustments need to be made to the network's model.

The proposal has been met with concern and frustration by $HNT tokenholders and network contributors. Upon the realization that the Helium Network was subsidizing hotspot operation, critics have argued that the protocol was artificially inflating and misreporting its revenue.

Others have argued that the mint of 141M new $HNT tokens to support growth and expansion is unjustifiably dilutive to existing network contributors. Given $HNT’s current circulating supply of 182.4M, the proposed mint would increase the number of tokens in circulation by 77.3%.

Departing Helium Team Members Weigh In

With critics and detractors slamming the proposal and disappointed supporters writing off the network’s future, former Helium executives have added some color to the debate. Abhay Kumar posited that shedding the economic weight of the network’s consumer brand, Helium Mobile, removes “a real cost off the books, which is good for the network and for the focus of the core team.”

Former Helium Protocol Engineer Noah Prince reinforced Kumar’s position, arguing that Helium sits at a critical inflection point and comparing the current proposal to Uber’s decision to wind down its $3 uberPOOL offering. 

Prince asserts that while Helium has found PMF, the engineer acknowledges that “the age of subsidy is over”. Both Prince and Kumar expressed confidence in Helium’s new CEO Mario Di Dio, vouching for his ability to guide Helium through its next stage of growth and building on the foundation set by founder and former CEO Amir Haleem. 

$HNT Down 56% in 7D Following Helium Mobile Acquisition

Despite the vote of confidence from departing executive team members, markets are not looking favorably upon Helium Network. Between Noble Mobile’s acquisition of Helium Mobile, the reshuffling of personnel, and the outstanding governance proposal threatening to increase supply by 77%, $HNT has plummeted 53% in the last 7 days.

Meanwhile, some $HNT whale wallets are aggressively exiting their positions. After receiving 2.2M $HNT tokens on June 9, this wallet has already unloaded 900,000 $HNT on the market.

Outside of ongoing sales through Jupiter DCA, the wallet still holds 1.3M $HNT, currently valued at $412,000.

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