BTC Subunits: Satoshi, Bits, Millibits, Megabits

by in Bitcoin 101, Bitcoin For Beginners

BTC subunits

Bitcoin as any other currency can be denominated in minor values. You can buy a whole bitcoin, but you can also buy fractions of one bitcoin. Small values make BTC activities easier to manage and make transactions readable. Let's see what are they?

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Satoshi (Sat)

The smallest and also the most used fraction of BTC is Satoshi. It took the name of Satoshi Nakamoto, the author of the system used in blockchains and the bitcoin asset. One BTC consists of 100 million Satoshis. For fiat currencies, we can take the case of penny and pound. One penny equals 0.01 in terms of a pound. If we compare this to BTC and Satoshi, 1 Sat=0.00000001 BTC.

The pseudonymous creator of Bitcoin issued a white paper in 2008, which was a turning point in the financial world. The paper titled “Bitcoin: A Peer-to-Peer Electronic Cash System”, explained the use of a P2P network as an answer to the challenge of double-spending. Unlike the physical variants of global ventures, cryptocurrencies generally act in the digital field. So, there appeared a problem - that a digital asset can be managed in more than one financial operation, unlike types of printed money, as they, naturally stand in one place at a particular time.

Considering the fact that a digital asset isn't present in the physical environment, trading it does not eliminate it from someone’s ownership. Most analysts believe that Satoshi Nakamoto may own 1 million bitcoins, equal to 100,000,000,000,000 satoshis.

Despite BTC is not a part of a major currency pair, it can be purchased from other ventures. This can be done with the help of different Bitcoin exchanges, where individuals can deposit supported assets like dollars, pounds, and others into their accounts. Afterwards, they can use the balance to trade Bitcoins and eventually change them with other currencies. Like the rates of fiat currencies, the BTC price also depends on supply and demand.

Microbit (Bit)

A microbitcoin or ‘bit’ is one-millionth of a Bitcoin or 0.000001 BTC.

It is also marked by the stock symbol μBTC. One μBTC equals 100 satoshis. Although it is less common than a satoshi, there is a potential for its extension along with the BTC price rally. It is supposed that in the future, we will use microbits for daily purchases such as to buy a cup of coffee.

Millibit (mBTC)

Millibitcoin, as a sub-unit, is also known as a millibit. According to the International System of Units (SI), the prefix "milli" means one-thousandth. So, one millibit equals 0.001 BTC. Millibitcoins appeared in May of 2011 when the price of BTC reached $10 USD.

Bitcent or Megabit

One Bitcent equals 1,000,000 Satoshi. Centibitcoin (cBTC) – sounds a lot better and causes less confusion for mainstream consumers.

Although many people confuse the concept for the name, it is technically correct. It is similar to the case when one megabyte is often -wrongfully – labeled at 1,000,000 bytes. Anyway, to avoid this, the "centibitcoin" term is used, which causes less confusion.

Conclusion

The more you learn about Bitcoin, the more financial opportunities You discover. The facts that BTC is dividable and its units can be used for smaller transactions are really great. As BTC price is rising, many assume the use cases of these units will grow.

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Below You can see the subunits values to BTC

1 Sat = 0.00000001 BTC

1 Microbit = 0.000001 BTC

1 Millibit = 0.001 BTC

1 Megabit = 0.01 BTC

Recently Blockstream CEO Adam Back talked about satoshis and bits. In his opinion, Bits are way easier to use and they are the units that should be used the most. Many crypto enthusiasts believe that in the future crypto assets will replace fiat currencies, becoming the only means of payment. It is their divisibility into many parts that make it possible to use them not only for trading on the stock exchange but also in the service sector or trade.

No one knows the limits of the growth of the bitcoin rate, however, if the bravest predictions come true and the price of bitcoin rises to $ 1 million, it is precisely its division by 100 million satoshis that will still allow it to be used for small purchases, for example, to buy ice cream in a cafe.

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And even if the price of bitcoin grows to some incredible values, changes can be made to the bitcoin program code, which, without any problems, will make it possible to divide the currency even more than at the moment.