FreedomFi, the company trying to use open source software and CBRS to create a community-driven 5G network, has agreed to be purchased by Nova Labs, formerly known as Helium. Terms of the deal were not disclosed.

All 30 employees of FreedomFi will join Nova Labs. Nova Labs COO Frank Mong described the buyout as a “fantastic marriage of similar size companies working on decentralized 5G.”  

The merger brings together two teams that have been working to disrupt the wireless industry by enabling individuals to deploy and monetize their own wireless infrastructure.

FreedomFi is leveraging Facebook’s Magma Project, which makes core network elements available through open source code. The company sells a $1,000 gateway that runs the Magma core and connects to CBRS radios. Since CBRS spectrum can be used without a license, FreedomFi customers can create their own private cellular networks for less than $10,000.

Nova Labs’ secret sauce is cryptocurrency. The company created Helium Network Token (HNT) to incentivize individuals to deploy LoRaWAN hotspots in their homes and businesses. HNT is earned when hotspots provide and validate coverage and transfer data. Burning HNT creates data credits, which devices use to transfer data. Customers including Goodyear and M3 Agriculture Technologies use the Helium network to track assets.

Last year, FreedomFi founder Boris Renski pitched Nova Labs COO Frank Mong on the idea of adding 5G to the Helium network. Mong saw the value, and his company added a FreedomFi 5G crypto mining gateway to its roster of compatible hotspots. (Cal-Chip and Bobcat now offer 5G hotspots for the Helium network as well.)

Renski said FreedomFi has now sold between 6,000 and 7,000 5G gateways, but just 2,500 of those have been activated. Uncertainty about the value of HNT and/or the ability of CBRS hotspots to earn the currency may have kept some buyers on the sidelines, but Renski said momentum is accelerating. Of the 2,500 active hotspots, 1,100 have come online since the beginning of August.

Two radio manufacturers, Sercomm and Baicells, are now making CBRS small cells that are compatible with the Helium network. These are meant to be self-installed by individuals without telecom expertise. Baicells says its small cell can be configured and certified automatically, thanks to tight integration with Magma.

RELATED: FreedomFi sees demand for CBRS offload gear outpacing private wireless

People who deploy a Helium-compatible 5G hotspot and one or more CBRS small cells may eventually be able to earn HNT cryptocurrency by offloading traffic from public carrier networks. But several pieces need to fall into place before that can happen.

First, FreedomFi/Nova Labs needs a way to track the traffic offloaded onto its network. Renski said the team is almost finished creating a cellular settlement service which would measure gigabytes transmitted and share this information with public carrier accounting systems. The team is also working on a system that could allow people deploying hotspots to see the areas in which the carriers want coverage, if the carriers are willing to share this information.  

Second, FreedomFi/Nova Labs needs carriers to agree to offload their traffic. In the fall of 2021, as HNT and many other cryptocurrencies were soaring in value, Helium announced a deal with Dish Network, but that was characterized as a way for individuals to improve their own cellular coverage by deploying the hotspots. This week, Renski said FreedomFi is in conversations with two of the three U.S. Tier 1 carriers, as well as several MVNOs in the U.S. He expects a major “non-MVNO” announcement before year-end.

Third, Nova Labs needs to convert the tokens it is currently paying 5G network participants into cryptocurrency. The company says it is currently in a “genesis period,” and will convert the tokens into HNT at the end of this time. Right now, people earn the tokens just for providing coverage, but once the settlement system is active, they will also be compensated for moving actual traffic. Renski said that is when the payoffs will become more meaningful.

Strategic investors

Investors in Nova Labs and FreedomFi include Nokia, Qualcomm and Samsung. Nokia is the sole funder of NGP Capital, a venture capital firm that invested in Nova Labs last year. Samsung and Qualcomm have both provided funding to FreedomFi.

Nokia and Samsung both make CBRS radios, but neither has developed a Helium-compatible small cell yet. Renski said FreedomFi is not working with Samsung on anything significant at this time.

Qualcomm makes the modems for the Sercomm and Baicells CBRS small cells that are compatible with the Helium network. Renski said FreedomFi and Qualcomm are working closely together on “multiple fronts.”

Wi-Fi in the wings

FreedomFi is working with several manufacturers of Wi-Fi access points that will mine the Helium mobile token. Renski named Ecotech as one of the hardware partners, and said he expects a beta in Q3 and a larger rollout in Q4.

The Wi-Fi crypto miners would use open Wi-Fi, Renski said, calling it the “Magma equivalent” for Wi-Fi.

If FreedomFi launches Wi-Fi crypto miners, it will not be the first company to do so. A company called Wicrypt is already offering miners that support Wi-Fi as well as LTE.