What are Satoshis?



A satoshi is the smallest unit of bitcoin, just like pennies are the smallest unit of dollar and cents are the smallest unit of pounds. One satoshi equals 0.00000001 BTC (one hundred-millionth of a bitcoin). The name Satoshi Nakamoto comes from the creator(s) of Bitcoin, who developed this cryptocurrency and introduced it to the world in 2009.


The History of Satoshi

In 2009, an anonymous programmer (or group of programmers) under a pseudonym—Satoshi Nakamoto—described a way for people to trade money with one another directly, without needing a third party like PayPal or Western Union. The key was a decentralized system that required no middleman: Users who wanted to buy something would transfer their bitcoins directly to sellers, while miners would confirm all transactions and write them into a public ledger. This process is known as mining because it involves solving complex math problems in order to create new bitcoins. As more miners join in, they form what’s called a blockchain—essentially just a shared record of all bitcoin transactions ever made. This blockchain prevents rogues from spending other users’ coins or creating counterfeit coins.


Bitcoin Mining

Mining is a distributed consensus system that is used to confirm waiting transactions by including them in the block chain. It enforces a chronological order in the block chain, protects against double-spending, and allows different computers to agree on the state of transactions in a system without central oversight. To be confirmed, transactions must be packed in a block that fits very strict cryptographic rules that will be verified by nodes.

The Current Value of One Satoshi

As of June 30, 2016, there is $4.4 USD worth of bitcoins for every single satoshi. This fluctuates depending on what goes on with bitcoin pricing throughout a day or week—but it’s a good rule of thumb to think in terms of how many sats you need to get a certain amount of BTC.



Converting Satoshis into Dollars

This converter tool can be used to convert satoshis into dollars. A single satoshi equals a fraction of a cent, which means that bitcoins can get really expensive really quickly! In order to put it in perspective, consider that $1000 costs around 115,000 sats—you’d have to spend over $20000 in order to buy 1 BTC.