Yes, it's an economic mechanism to build wireless networks. There are definitely externalities as you say. However what I find amazing is they successful built the network when all other traditional means of doing so had failed. See the recent bankruptcy of sigfox.
Helium is the quintessential example of Blockchain doing obvious social good when all traditional means of accomplishing the same goal had failed.
I can't quite figure out from the site: I provide some connectivity to the network, but don't I have to worry about anonymous traffic like as if I were running a tor exit node? Seems to me that should be a big concern.
Helium reached a scale orders of magnitude larger in 1/5th the time. As TTN is a community effort it can't really fail in a traditional sense, but it has been lapped several times over at this point.
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.
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.
Helium is the quintessential example of Blockchain doing obvious social good when all traditional means of accomplishing the same goal had failed.