HOTP works just like TOTP, except that an authentication counter is used instead of a timestamp. The advantage of this is that HOTP devices require no clock. However, HOTP is susceptible to losing counter sync. That is, if the user generates an OTP without authenticating with it, the device counter will no longer match the server counter. This can be mitigated on the server by testing several subsequent counter values. This can not happen with Yubico OTP since its counter is encrypted (as opposed to hashed).