After weeks of sustained bullish momentum, Helium (HNT) has now succumbed to bearish pressure, diverging from the broader market’s short-term surge. Recent market data reveals that HNT has declined by nearly 16% over the past week, resulting in a notable shift in investor sentiment.
This downward trend in HNT’s market performance is largely attributed to recent developments within the Helium community concerning the upcoming Helium v3 network upgrade. With community reactions brewing, HNT may continue to struggle in the short term.
An Overview of Helium v3
Last week, the official X account announced the release of the Helium v3 proposal, which aims to significantly revamp the current system running on the platform. According to the official blog post, the new system will introduce a new economic model designed to “empower others to join and successfully scale with [us] on the Helium Network.”
The community, however, has zeroed in on a specific aspect of Helium v3 that involves increasing the maximum number of HNT tokens in circulation. According to the blog post, the new model will introduce a one-time mint of 5 million HNT for HST redemption, which will be redeemable for locked HNT one year after implementation.
Another core focus of the new economic model is emission adjustments, with an annual 10 million HNT to be emitted by the network, divided equally among the platform’s subnetworks. If the proposal is approved in its current form, the maximum supply of HNT will increase from 223 million to 238 million, representing nearly a 7% rise.
This proposed economic system has sparked criticism among community members. One user noted that the proposal seems akin to a slow rug pull, while others pointed out the inflationary measures being suggested by the development team.
“I love the ideas! [But] This part I highlighted is concerning: how can anyone propose changing the max future supply of HNT? It should be fixed forever at 230 million. Please tell me I’m reading this incorrectly,” commented user PessimisticPokerist in response to the post.
As of now, HNT is trading at $6.39, according to TradingView data. Given that the proposal is still in its early stages, the current points of interest may evolve as community discussions continue.
HNT’s Potential Return to Mid-August Levels
With community members voicing their concerns about the early Helium v3 proposal, investors and traders have detected a shift in sentiment, transforming the previously bullish outlook for HNT into a bearish one. As of this writing, bearish forces are targeting the $6.1 level in the short term, potentially reversing the gains made since last month.
One thing is evident: HNT’s trajectory seems poised to continue its downward trend as bullish momentum wanes. If bearish forces break through the $6.1 level, we could see HNT return to its July levels, completely undoing the gains made since the beginning of the third quarter of the year.
