What is Bitcoin Satoshi in simple words

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16.01.2020
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What is Bitcoin Satoshi?

Bitcoin (BTC) is the most popular and most capitalized cryptocurrency of all digital assets on the market. The cost of one coin in rubles in December 2017 has reached a record RUB 1 231 576. As of the time of writing the review (January 10, 2020), the cryptocurrency was trading at RUB 482 668, according to the resource CoinMarketCap

Despite the significant decline in the price of the asset, BTC as a currency is still too expensive. The solution to the problem of using bitcoin as a financial instrument for conducting mutual payments was the division of the coin into its parts - satoshi. About what the countertype of cents in Bitcoin is, you may read further in the material.

 

Information about Bitcoin. Data: CoinMarketCap

What is Satoshi in Bitcoin?

In order to give a full answer to the question of what bitcoin satoshi is, it is necessary to understand the meaning of the word itself denoting the constituent unit of the whole coin. BTC got its name "cent" in honor of the creator of the most capitalized cryptocurrency - Satoshi Nakamoto.

Whether the latter is a man, a woman, or a group of individuals, it is still unknown. The only reliable information that members of the crypto community have at their disposal is the implementation of the technical code and the launch of bitcoin - the work of a certain Satoshi Nakamoto.

 

Some of the contenders for the title of Satoshi Nakamoto (from left to right): programmer Dorian Nakamoto, entrepreneur Craig Wright, cryptographer Nick Szabo, creator of the Litecoin cryptocurrency Charlie Lee.

The decision to name the smaller parts of the first cryptocurrency after its creator is considered to be a gesture of respect for the programmer. According to some reports, the name was proposed in 2010 by a user of the BitcoinTalk forum, registered under the nickname Ribak. Members of the forum liked the idea, due to which later it was taken as a tradition.

Many members of the crypto community argue about how to spell and declare the name of the BTC faction correctly. Some believe that the singular and plural should be written as satoshi. According to others, the word satoshis should be used when denoting several units.

A number of users, taking into account the background of assumptions that Satoshi Nakamoto is Japanese (accordingly, his name has Japanese roots), are confident that the rules of the native language of the creator of the cryptocurrency should be applied to the norms of pronunciation and writing of a unit of bitcoin. In this case, the correct options are satoshi and satoshisa (singular and plural). In rare cases, you can find satoshi abbreviations to sat or s.

About transition to satoshi

Today it is difficult to believe in it, but in 2010 the bitcoin rate was at the level of $ 40-50. During this period of time, cryptocurrency was just at the beginning of gaining popularity as an alternative way for payment.

Few people believed in the possibility of a serious rise in the BTC rate. An example of this attitude towards the prospects of bitcoin is the case of buying a pizza, which later became a legend.

In 2010, a programmer named Laszlo Heinitz made a post on a thematic forum with a message in which he offered to pay 10 thousand BTC for any delivery for a couple of pizzas. Commentators noted that the amount of bitcoins indicated by him is approximately $ 41 (about 1200 rubles, as of the period of publication of the announcement). In the opinion of many, such a proposal could not interest anyone.

Nevertheless, the deal took place. At the moment, buying two pizzas for 10 thousand BTC would cost 4 859 433 443 Russian rubles. Due to the rise in the value of the bitcoin rate, the current equivalent of $ 41 is 0.0052 satoshi.

The active growth in the value of bitcoin, which ultimately led to the forced transition to work with Satoshi, can be divided into several stages:

  • 2010–2014 - popularization of BTC as a means of payment for goods and services on the darknet. At the end of 2013, the value of the coin reaches the level of $ 1200.
  • 2015-2016 - the growth in the number of digital asset exchanges, contributing to the increase in the popularity of cryptocurrency. The collapse of the Mt.Gox exchange, followed by a fall in the value of bitcoin to the level of $ 180 (early 2015).
  • 2017 - active development of ICO. In late 2017 - early 2018, most of the most capitalized cryptocurrencies reached their maximum, as of early January 2020, price values. In December 2017, the Bitcoin exchange rate set a record near the $ 20 thousand level.
  • 2018 is a period of "crypto winter" with the descent of Bitcoin to the level of $ 3700.
  • 2019 - the cryptocurrency reaches a local maximum near the $ 14 thousand mark.

Another reason for the popularization of satoshi was the transition of BTC to the category of tools for preserving value. Bitcoin emission is limited. The mechanism of mining cryptocurrency implies independent regulation of the inflation rate.

The bitcoin code is built in such a way as to ensure a gradual increase in the value of coins. As a result, large amounts of BTC remain in the accumulation format. If it is necessary to use the first digital asset for payment, the majority use satoshi.

Statistics on the distribution of funds among the wallets, depending on the balance level. Data: BloomChain.

Based on the frequency of mentioning satoshi as a unit of measurement, the definition became really widespread in 2011.

A few words about Bitcoin emission

In total, about 21 million Bitcoin will be mined. 1 satoshi is equal to 0.00000001 BTC (100 millionth part of a whole coin). Accordingly, the total amount of bitcoins that will ever be mined can be represented as 2,100,000,000,000,000 Satoshi.

Bitcoin mining is expected to continue for another 120 years. During this period of time, the number of available Satoshi will continue to increase.

Bitcoin mining speed. Data: blockchain.com

It is important to mention that despite the high cost of one bitcoin, which opens the feasibility of evaluating goods and services in Satoshi, many still prefer to indicate prices in BTC.

The ways to get Satoshi

Today, those wishing to independently find out what satoshi is, by interacting with them, can take advantage of various opportunities for obtaining digital assets. The available options will be presented below.

Fiat exchange

СThe easiest way to get satoshi is to buy them. To do this, it is possible to use the services of exchangers, cryptocurrency exchanges, OTC platforms, or purchase the required amount of assets for fiat from individuals. When exchanging traditional money for satoshi, the following peculiarities must be taken into account:

  • Many exchanges and exchangers work according to the KYC (“know your customer”) rules. Deanonymization (provision of documents confirming the user's identity) may be required to carry out the exchange operation. The process of activating an account and checking documents can take a long period of time.
  • The minimum transaction amount and the result of the exchange may differ from expectations. Many resources put forward requirements for ensuring the entry threshold for the transfer of funds. For example, the user expected to transfer 500 rubles to satoshi, but according to the rules of the exchange, the minimum amount of replenishment and exchange is 1000 rubles (which exceeds the amount of funds available to the buyer). Also, do not forget about commissions for depositing and withdrawing assets from sites.
  • Transactions on anonymous unregulated platforms and with individuals are the most dangerous. By forming an exchange agreement, the user will not be able to obtain protection of his interests.

A simple way to exchange rubles for satoshi for Russian-speaking users can be a conduction of transactions on the Russian exchanges EXMO and Binance. On the latter, not so long ago, a crypto-fiat gateway appeared for transferring rubles to cryptocurrency.

Earnings

Another way to get sat is to earn money on your own. In this case, the user will be able to pass over the difficulties associated with converting fiat into cryptocurrency. Below are the options for mining satoshi.

Employment

You can find many job advertisements with payment in cryptocurrency on the Internet. Most of the vacancies are for English-speaking people, but if you search carefully you can also find offers for a Russian-speaking audience. To find vacancies, you can use the following resources:

  • Search branches for specialists in specialized forums. An example is a branch for posting vacancies on the bitcointalk platform.
  • Specialized Telegram channels. Examples: Crypto HeadHunter, TokenWork.
  • Companies specializing in working with digital assets (magazines, exchanges, exchangers).

Payment does not have to be in sat. The salary received in another cryptocurrency can be exchanged for satoshi.

Participation in competitions

ДAnother way to get satoshi is to participate actively in competitions. The latter do not guarantee a prize. At the same time, in case of success, the user can become the owner of the volume of digital assets declared by the organizers of the event. You should search for contests on thematic forums.

Bitcoin faucets

Many members of the crypto community believe that Satoshi was popularized basically due to bitcoin faucets. The latter are services within which users are invited to perform any mechanical actions or solve tasks that do not require a high level of skill, in exchange for cryptocurrency (for example, captcha input).

Such actions are rewarded according to conditions agreed in advance. Most of the existing bitcoin faucets are famous for their high commissions, as well as difficulties with the withdrawal of funds. Despite the problems, this method of mining cryptocurrency can open up the opportunity for the user to receive the start-up capital of digital assets.

Trading

The basis of making money on trading is the ability to predict the further behavior of the cryptocurrency rate. Working in this direction is suitable for users with the necessary theoretical knowledge and practical skills.

Trading can become a tool for multiplying Satoshi faucets received with the help of Bitcoin faucets.

Is Satoshi worth investing in?

Buying a whole bitcoin today is a task that only wealthy people can cope with. As a result, most of those wishing to join the crypto community prefer to start investments with sat.

In order to understand whether it is worth investing in satoshi, it is necessary to turn to the prospects for investing in bitcoin as the first cryptocurrency. BTC's behavior reflects the “health” of the digital asset market. The reason is that bitcoin is the main symbol of the concept of cryptocurrency (as a new financial instrument).

In the event of regulatory problems (for example, a cryptocurrency is banned by the government of any country), bitcoin will inevitably react to the incident with a decline of the price. It is important to note, however, that bitcoin can be viewed as a “sponge” that absorbs funds invested in projects that have exhausted themselves.

The proof of the latter is the rise in the value of BTC against the background of an active fall in the share of altcoins in the market. Funds invested in alternative cryptocurrencies, with a decrease in the viability of coins, in most cases "flow" into bitcoin. Accordingly, as long as there are altcoins on the market, bitcoin has something to “feed ”.

Comparison of the market share occupied by BTC with the behavior of the asset price. Data: CoinMarketCap.

The features of the Bitcoin code also speak in favor of the growth in the value of the first cryptocurrency. According to the CEO of the popular exchange of digital assets Binance Changpeng Zhao, every owner of at least 1 BTC in the future can become one of the richest people in the world.

Conclusion

It turns out that the answer to the question “satoshi - what is it in simple words” is impossible without binding the given unit to bitcoin. As the whole coin is characterized by the high cost, its constituent parts have become a popular calculation tool.

Taking into account the prospects for further growth in the value of BTC, sat can be considered as a full-fledged investment unit.

 
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