What is a satoshi (sat) and why are they the future of Bitcoin (BTC)?
Fiat currencies such as the euro (EUR), dollar (USD) or pound (GBP) have a specific denomination for hundredths of units. As you know, one pound is divided into 100 pence, each worth one hundredth (1/100) of a pound. Likewise, Bitcoin is divided into many very low units, which allow it to be used in a realistic setting. Looking past the constant fluctuations in its price, the value of one bitcoin may well rise very high, which, without sufficient divisibility, would make it almost impossible to use, buy or sell.
What is a satoshi?
The satoshi is a unit of Bitcoin in the same way that the penny is a unit of the pound. The satoshi is the smallest unit of Bitcoin. Until 2015, when Bitcoin joined the standardised currencies under ISO 4217, “bitcoin (BTC)” and “satoshi (sat)” were the only official units of BTC. Subsequently, other units were added, including millibitcoin and microbitcoin.
Note: buy your first sats by exploring the best cryptocurrency buying platforms.
Who created the satoshi?
“Satoshi Nakamoto” is the pseudonym of the person or people behind the Bitcoin protocol, created in 2009. However, it was not until 2010 that the issue of BTC divisibility was addressed. One of the users of the forum Bitcointalk, nicknamed “Ribuck”, put forward the concept of the satoshi. Ribuck first envisaged a satoshi as being 1/100th of a bitcoin.
It was only three months later that the subject reappeared, on 11th February 2011. The problem of divisibility, ever more important, called for a much smaller unit than Ribuck initially thought.
How many satoshis are in a Bitcoin?
It was then decided that a satoshi would be set as one microbitcent, or one hundred millionth of Bitcoin!
|1||0.000 000 01|
|10||0.000 000 1|
|100||0.000 001||1 µBTC (sometimes called 1 bit)|
The satoshi still has no symbol
Although Bitcoin has its own symbol (฿), the satoshi still does not hold this privilege. Commonly shortened to the word “sat”, there is still no consensus as to which emblem should represent it. While the debate around the symbol for the sat is much less fierce than the original one to decide how big a sat should be, it has led to a number of interesting candidates:
What are the benefits of the satoshi?
For investors, buying an entire Bitcoin is not always possible or desirable. By purchasing satoshis instead, it is possible to invest in Bitcoin on any scale.
Reminder: if you want to know how to buy Bitcoin, follow our guide.
Many hope to see Bitcoin become a regular currency that is used every day. For this to be realistic, it would be difficult to navigate prices showing millionths (or even less!) of a bitcoin. This is where the sat comes into its own. Very soon, this denomination will make it possible to buy products and services with BTC!
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