Bitcoin has multiple denominations, one of which is called a satoshi. Keep reading to learn how much this unit is worth and from where its name derives.
What Is A Satoshi?
A satoshi, often abbreviated as sat, is the smallest unit of a bitcoin. It equals 0.00000001 BTC, which means that there are 100 million satoshis in 1 BTC.
This denomination was named after Satoshi Nakamoto, the anonymous founder(s) of Bitcoin.
What You Need To Know About Satoshis
One bitcoin is divisible to eight decimal places, including satoshi. This enables crypto enthusiasts to invest in BTC on any scale, without having to buy an entire coin.
Despite the fact that, according to the satoshi definition, a sat is the smallest part into which a bitcoin can be split, some scenarios may require further division. For instance, the Lightning network, a scalability solution for Bitcoin, uses millisatoshis for minor transactions (1 sat = 1,000 millisat).
Theoretically speaking, if the need for it arises, the Bitcoin protocol could potentially be updated to enable the creation of additional BTC denominations. However, currently, when a transaction is broadcast to the Bitcoin network, millisats are rounded down to the nearest satoshi.
While Bitcoin has an official symbol (₿), the crypto community hasn’t come up with one for satoshi yet. This means that the discussion is still open and new variants are being proposed on a regular basis. Dozens of options are available already today and only time will show whether one of them will find wide adoption as the symbol of the smallest bitcoin unit.
Aside from satoshi, you may also encounter other bitcoin denominations. Most of them are not frequently used, but the two most widely known ones are:
- Microbitcoin (μBTC) – one-millionth of a bitcoin (0.000001 BTC)
- Millibitcoin (mBTC) – one-thousandth of a bitcoin (0.001 BTC)
