Understanding What is Satoshi and the meaning of Satoshi.Satoshi or Satoshis is the basic unit of Bitcoin as defined in the Bitcoin protocol. For folks who are not familiar with Bitcoins or digitail currencies the analogy i would give is that of corresponding Fiat currencies like USD , Euro or INR.
Satoshi is to Bitcoin what Cent is to dollar or cent is to Euro or Paisa is to INR ( Indian Rupee) and so on. As one dollar has 100 cents so 1 Bitcoin = 10 ^8 Satoshis.
Here is the broad Bitcoin Divisions which are followed as a standard
•1 BTC = 1,000 mBTC (millibitcoin)
•1 BTC = 1,000,000 μBTC (microbitcoin)
•1 BTC = 100,000,000 Satoshis
•1 mBTC = 100,000 Satoshis
•1 μBTC (microbitcoin) = 100 Satoshis
So If we have to create a Direct Satoshi Converter. Here is how the Bitcoin divisions will look like.
- 1 Satoshi = 0.00000001 Bitcoins
- 10 Satoshi = 0.00000010 Bitcoins
- 100 Satoshi = 0.00000100 Bitcoins
- 1000 Satoshi = 0.000001000 Bitcoins
- 10000 Satoshi = 0.00010000 Bitcoins
- 100000 Satoshi = 0.00100000 Bitcoins
- 1000000 Satoshi = 0.01000000 Bitcoins
- 10000000 Satoshi = 0.10000000 Bitcoin
- 10000000 Satoshi = 1.00000000 Bitcoin
If you are looking to convert Satoshi to USD or Satoshi to Euro or Satoshi to INR. You can use the following Converters
If you are looking for earningsome free Satoshis Read one of our quick guides on How to earn free Satoshi.
Why was Satoshi’s name used for smallest unit of Bitcoin
Satoshi as a name for the smallest unit of Bitcoin was proposed by a Bitcoin Forum user Ribuck back in 2010.See the extract of the post below. If you want to read the whole conversion go here
As quite clear from the thread as bitcoin price started increased community started looking at solutions to increase divisibility of Bitcoin so as to ensure it aligns with changing requirements in market vis a vis Fiat currencies. Then in February 2011 one of the communuty member proposed the following divisions.
1 Satoshi = 1 Micro Bitcent | 100 Million Satoshis = 1 Bitcoin
and the communty agreed to it .This is the small story behind how smallest unit of Bitcoin was named Satoshi.
Why is Satoshi pegged at 10^-8 Bitcoins
Smallst unit of Bitcoin will be equal to 10-8 units has been part of the core protocol buuilt by Satoshi. The questionis was this choice arbitrary or Satoshi Nakamoo to and the team had a good reason for the same. Some of the reasons that have been suggested include
- Providing greater divisibility for Bitcoins to encounter the eventual deflationaory impact of Bitcoin. Bitcoins is a deflationiory currency with a limited supply and the value increases we will need more divisibility.
- Arbitrarily coded by Satoshi may be because he liked number 8 or he was superstitious about 8
- Some Geeky reason like 0.00000000 is prefered as it resembles the 8 hex digits of a 4 byte (32bit) integer 0x1234AB
Finally one of the founding members cleared the air on the thread how smallest unit of aI guess one of the early members of of Bitcoin community pointed out how the founders looked at the Dollar supply at that time and tried to do someback calculations on how bitcoin can support smalles fiat currency units. They looled at M1,M2 and M3 money supply and decided to use M1 money supply as a reference point and figured out 8 decimal units should take care of it. Below screenshot has the relevant extract from Bitcoiin forum thread.
Satoshi as a unit of Transaction
As the price of bitcoin keeps going up practical utility of Satoshi unit has started going up.. Bitcoin Faucets were the first one to actively use Satoshi or Satoshis to give Bitcoin freebies to users or use them for micropayments of small taks like Captcha filling or survey filling. Many of the exchnages have started dealing in Satoshis especially in places where local currency is as fraction of dollar value. Some of the bitcoin exchanges in India like Zebpay lets you buy bitcoins in Satoshi units. Satoshi is here to stay and going to become more popular as a unit of bitcoin as the price of bitcoin starts going up.