How to Convert IOT to HNT in the Helium Wallet

The Helium network uses specialized digital tokens to operate its decentralized wireless infrastructure. IOT tokens are earned by LoRaWAN (Long Range Wide Area Network) Hotspots that provide network coverage and transfer device data. HNT, or Helium Network Token, functions as the primary utility token of the Helium network, serving as the base currency for network usage and governance. This article explains the process of converting IOT tokens into HNT within the official Helium Wallet application.

The IOT to HNT Redemption Mechanism

The conversion of IOT to HNT operates through a unique “burn-and-mint” mechanism, distinct from traditional cryptocurrency exchanges. When a user initiates a conversion, the specified amount of IOT tokens is permanently removed from circulation, or “burned.” Simultaneously, a corresponding amount of new HNT tokens is created, or “minted,” and delivered to the user’s wallet.

This process is governed by an oracle system, which continuously determines the conversion rate between IOT and HNT. The oracle’s rate is dynamic, adjusting based on network demand and the supply of both tokens. This ensures a transparent and algorithmically determined value for the redemption, rather than a market-driven price on an open exchange. The mechanism is designed to manage the supply of HNT and align it with network activity.

Prerequisites for Conversion

Before initiating any conversion, users must ensure they have the official Helium Wallet application installed and updated to its most recent version on their mobile device. Maintaining an updated wallet is important for security and access to the latest features. It is also important to confirm that the wallet’s recovery phrase, often referred to as a “seed phrase,” is securely backed up in an offline location. Losing this phrase means permanent loss of access to your tokens.

Users must also verify that their wallet contains a sufficient balance of IOT tokens for the desired conversion. The wallet interface will display the current IOT holdings, allowing for a quick check. Furthermore, a small amount of Solana (SOL) tokens is necessary to cover the network transaction fees associated with the conversion process. These fees are often a fraction of a cent in U.S. dollar equivalent, ranging from approximately $0.00001 to $0.001 per transaction.

If a user does not possess SOL, a minimal amount can be acquired by receiving a small transfer from another wallet or through a small swap on a decentralized exchange. Maintaining accurate records of all cryptocurrency transactions is important for potential tax reporting obligations, as the Internal Revenue Service (IRS) treats virtual currency as property.

Executing the Conversion Steps

After completing prerequisites, the conversion process begins within the Helium Wallet application. Open the application on your mobile device and navigate to the “Redeem” or “Convert” section, which is typically found within the main wallet interface or a dedicated token management tab. You will then be prompted to select the type of token you wish to redeem, in this case, IOT.

After selecting IOT, input the amount of IOT tokens you wish to convert into HNT. The application will then display the current conversion rate and an estimated amount of HNT you will receive. This provides a clear preview of the transaction before final confirmation. Review these details carefully.

Proceeding with the conversion requires confirmation, which involves entering your wallet password or using biometric authentication like a fingerprint or facial scan. At this stage, the application will also display the Solana network fee. Confirming this fee allows the transaction to be submitted to the Solana blockchain. The transaction will then move into a pending state while it is confirmed on the network, which takes only a few seconds to a few minutes.

Verifying Your HNT Balance

After the conversion transaction has been successfully submitted and confirmed on the blockchain, verify the updated HNT balance within your Helium Wallet application. Return to the main wallet dashboard where your token balances are displayed. Your HNT balance should reflect the newly acquired tokens from the conversion.

To review details of the completed conversion, navigate to the transaction history section within the application. This area provides a ledger of all past transactions. You will see an entry indicating the amount of IOT burned and HNT minted, along with the transaction ID. While most conversions are processed quickly, network congestion can lead to delays in balance updates.