After weeks of sustained bullishness, Helium has now succumbed to bearish pressure going against the grain as the broader market surges higher in the short term. last Market data shows that HNT has fallen nearly 16% since last week, leading to a turnaround in investor sentiment.
HNT’s short-term market performance is largely due to a recent development in the Helium community regarding the upcoming Helium v3 network upgrade. With the recent community uproar, we can see HNT struggling to perform in the short-term.
A brief introduction to Helium v3
Last week the official X account was announced the release of their Helium v3 proposal which will change much of the legacy system running under the hood of the platform. According to the official blog postThe new system will include a new economic model to “enable others to join us and scale successfully on the Helium Network.”
However, the community focused on one of the aspects of Helium v3, which increases the maximum number of HNT tokens in circulation. According to the blog post, the new model will increase the total supply by a one-time coin of 5 million HNT for HST redemption that will be redeemable for locked HNT after 1 year of implementation.
Emission adjustments are also a core focus of the new economic model with an annual emission of 10 million HNT by the network, divided equally across the platform’s sub-networks. If the proposal is implemented in its current state, the maximum supply will jump from 223 million to 238 million – an increase of almost 7%.
This proposed economic system has drawn criticism from community members. One user noted that the proposal seems like a slow carpet, while some pointed out the inflationary measures proposed by the dev team.
“I love the ideas! (But) This part I highlighted is concerning: how can anyone suggest changing the max future supply of HNT? It should be fixed at 230 million forever. Please tell me I’m reading this wrong,” user PessimisticPokerist said in a answer to the post.
As the proposal is still in its early stages, current focus areas may change as community dialogue progresses.
HNT returns to mid-August levels
With community members criticizing the early Helium v3 proposal, investors and traders have felt a shift in sentiment, turning the overwhelmingly bullish start for HNT into a bearish one. At the time of writing, bears are targeting $6.1 in the near term, reversing gains made since last month.
One thing is clear: HNT’s trajectory will continue to decline as the bulls lose steam. If the bears are not stopped at $6.1, we may see a return to July levels, completely erasing the gains made since the start of the third quarter of the year.
Main image of Discovery #MINDBLOWN, chart from TradingView