Just like one U.S. dollar can be divided into dimes, nickels, and pennies, bitcoin can be similarly calculated in smaller amounts. Considering 1 bitcoin has averaged more than $30,000 in 2021, dividing it into smaller quantities makes the cryptocurrency more practical and easier to use for many bitcoin owners. At the core of this is a satoshi, which is not only important for calculating small amounts of bitcoin, but for conducting transactions on the network. Read on to learn more about the satoshi, the origins of its name, and how to calculate the number of satoshis you purchased.
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What is a satoshi? Learn more about this bitcoin measurement
A satoshi, or “sat,” is the smallest measurement of bitcoin recorded on the blockchain. It’s equivalent to one hundred millionths of a bitcoin (BTC), or 10^8 BTC. If decimals are your thing, one satoshi is .00000001 BTC. Sometimes, you may even see people refer to satoshis as ‘sats’ in their bitcoin wallet.
Satoshis are not just important for their ability to make bitcoin more usable: They are important for how BTC is transacted. Every bitcoin transaction, both buying and selling, is conducted in sats.
Where did satoshi come from?
The term satoshi has significant history in the crypto community. The unit is named after Satoshi Nakamoto, the alleged creator of bitcoin. There has been no precise confirmation as to who initially created bitcoin back in 2008. However, the name commonly used to refer to this entity is Satoshi Nakamoto, who could have been a person or a group of people.
Using the term “satoshi” to describe the smallest possible bitcoin unit emerged from forums dedicated to conversation around the cryptocurrency. The idea, initially floated more than a decade ago, is traced back to a user named “ribuck” on that forum. Ribuck proposed that bitcoin could, and should, be divided into smaller units of measurement, one of which was the satoshi. While it took time to catch on, the name eventually stuck once more people acknowledged that this division of bitcoin was crucial for its scalability and usability. Prior to ribuck’s suggestion, the term “microcent” was used to refer to the smallest division of bitcoin.
How many satoshis are in a bitcoin?
One bitcoin is made of 100,000,000 satoshis.
A satoshi is among several measurements of the cryptocurrency, which can be grouped into larger components if necessary. Bitcoin can also be categorized into millibitcoins (mBTC) and microbitcoins (μBTC). There are 1,000 mBTC in a bitcoin, and there are 1 million μBTC in a bitcoin. These are just different ways to classify the same amount. For example, 5 mBTC would equal 5,000 satoshis.
How many dollars is 1 satoshi?
The cost of one satoshi fluctuates naturally, depending on the cost of one bitcoin. You can expect bitcoin prices to rise and fall throughout the week, and many times throughout the day as well. This is perfectly normal and expected as cryptocurrency grows over time.
To illustrate this conversion, let’s explore two examples.
- On June 1, 2021, the value of 1 bitcoin was $37,340.68. When that amount is divided by .00000001, you get a dollar amount of $0.0003734068 per satoshi.
- On May 15, 2021, the value of 1 bitcoin was $49,913.26. When you divide that number by .00000001, the cost per satoshi is $0.0004991326.
How do you buy satoshis?
As mentioned earlier in this guide, all bitcoin transactions are conducted and recorded in satoshis on the blockchain. This means that you are buying satoshis (and all other measurements of bitcoin, technically speaking) when you make a bitcoin purchase. Next time you tell your friends you bought some bitcoin, you can tell them you were ‘stacking sats’.
There are several ways to buy and sell bitcoin. As the biggest and most well-known cryptocurrency, bitcoin is readily available for purchase and trade on traditional brokerages. There are also apps dedicated to cryptocurrency purchases, bitcoin ATMs, and buying and selling directly from other bitcoin owners.
When you purchase bitcoin through Coinme, you can access a convenient and easy way to exchange up to $2,500 per day in bitcoin. Our bitcoin kiosks and tellers can be found throughout the U.S., oftentimes located at your favorite local grocery store. To exchange U.S. dollars for bitcoin at a kiosk, you simply walk up, follow the instructions, and receive a voucher at the end of your transaction with a confirmation number on it. Use this confirmation number on your smartphone or laptop to log into your digital wallet and redeem your purchase. It’s that simple! To get started, check out our location finder to find a kiosk near you.