HNT, the native token of the Helium network has cliff-dived more than 35 percent in the last one week. Helium is a hotspot network that was once touted as the next big thing in the crypto industry. The project began as a blockchain-based wireless network for IoT devices, such as tracking chips or sensors, that need an internet connection to function.
Helium created a network of Low Range Wide Area Network (LoRaWan) hotspot devices that provided coverage for millions of such IoT devices. Interested users can purchase and run WiFi routers, known as Helium Miners, that would provide network coverage to IoT devices. In exchange, these users would receive the network’s native cryptocurrency, HNT, as a reward for their contribution to the network.
Initially, the project aimed to provide network coverage solely to IoT devices. However, the project snowballed into a 5G cellular network, with over 1 million hotspot devices worldwide. The idea of a decentralised, blockchain-based wireless network, dubbed the “People’s Network”, quickly grabbed investor attention, causing HNT to hit an all-time high of $51.15 in November 2021. However, the crypto winter in 2022, further exacerbated by the Terra Luna and FTX meltdowns, took a toll on the crypto industry, including HNT.
The token fell more than 96 percent from its all-time high and was trading at $1.58 by the end of 2022. However, troubled times seemed to have ended as HNT, along with the broader crypto industry, began to recover with the onset of 2023. Helium more than doubled in value, trading at $3.20 towards the end of February. Unfortunately, the project is once again facing headwinds as its native cryptocurrency has fallen more than 35 percent in the last week and continues on a downward spiral. This is despite the fact that most other cryptocurrencies are enjoying massive gains on the back of a sudden upswing in the crypto market. Tag along to find out why this once-hyped network is currently on a massive downward trend.
What is the reason behind HNT’s recent price drop?
There are multiple reasons for HNT’s recent decline. Perhaps the biggest reason could be Binance’s recent announcement stating that it would delist the token from the platform in the coming days. The world’s largest crypto exchange will discontinue the HNT/USD trading pair on March 24, at 03:00 (UTC). Further, by March 25, HNT deposits will no longer be excepted. Affected users may withdraw their funds until April 17, and those that fail to do so will be provided with another chance withdraw their tokens between April 21 and April 24.
Also Read: USD Coin vs Tether: A quick comparison of the top two stablecoins in the market
This announcement came on March 17, shortly after Helium announced the date (March 27) for its migration to the Solana network. Following Binance’s announcement, HNT dropped from $1.97 on March 17 to $1.58 the next day and gone on to record further losses over the last two days. Binance did not provide any specific reason for the delisting, only stating that the token “no longer adheres to its standards.” It also offered it’s a list of factor for delisting, which include lack of team commitment and developer activity, declining trading volume, safety and stability against attacks, etc.
To make matters worse, several reports have revealed that Solana has delayed its migration to April 17. As mentioned earlier, the update was first scheduled for March 27 and promised to improve data transfer for devices. It would also make the Helium protocol faster, more reliable, and more scalable. Therefore, a successful migration could have offset some of the losses from the Binance delisting. However, now even that seems a long way away.
Fortunately, Helium did acknowledge the delisting and did offer some solutions for affected users. “The @binance delisting of HNT is unfortunate. Token owners should consider moving to the self-custodial Helium Wallet app or an exchange that has confirmed migration support. More confirmed partners will be announced to the ecosystem in the coming days,” the project tweeted on March 17. In the same thread, it also highlighted Gate.io as one of the crypto exchanges that will support migrated HNT.
Conclusion
At the time of writing, HNT was changing hands at $1.47 per unit. The token has fallen more than 35 percent from its $2.35 valuation on March 13. The losses seem worse when you consider that HNT was trading as high as $3.22 on Feb 20. Now, whether or not the token can register a comeback after its migration to Solana remains to be seen.
Also Read: Explained: Crypto supernets and how they work
