Satoshi

Bitcoin has eight decimal places, so one coin is 100,000,000 satoshis and the whole 21 million supply is 2.1 quadrillion of them. Wallets show you decimals for human comfort, but the software underneath never handles fractions of a coin, only whole satoshi integers. Once you think in satoshis, the question "can I afford bitcoin" stops making sense.

How it works

Satoshis are integers, and that is a deliberate engineering decision rather than a naming convention.

Floating point arithmetic loses precision, which is unacceptable in money, so Bitcoin Core stores every amount as a signed 64 bit integer counting satoshis. The largest amount the system can express, 2,100,000,000,000,000 satoshis, sits far below the 9.2 quintillion ceiling of that integer type, so no legitimate transaction can overflow it. Consensus checks, fee calculations, and change outputs all happen in whole satoshis; the decimal point you see in a wallet is added at the last moment for display.

The unit is named after Satoshi Nakamoto and was adopted by the community rather than defined in the original code, which simply used the number 100,000,000 as the constant COIN. Two smaller and larger units sit around it. Lightning goes finer, quoting amounts in millisatoshis, one thousandth of a satoshi, because routing fees on tiny payments would otherwise round to zero. Fee estimates go coarser, quoting satoshis per virtual byte, because what you pay depends on how much block space your transaction occupies rather than how much value it moves.

Below a certain size an output stops being economically spendable, and the software says so. Bitcoin Core will not relay an output worth less than the dust threshold, 546 satoshis for a legacy pay to public key hash output, because spending it would cost more in fees than it contains.

Why this matters when you buy bitcoin

Thinking in satoshis fixes the single most common misconception among first-time buyers: that bitcoin is something you buy whole or not at all.

Every exchange sells fractions. A recurring 25 dollar buy at River or Swan is a purchase of a few tens of thousands of satoshis, and at a price of 100,000 dollars per coin, one satoshi costs one tenth of a US cent. Denominating your own thinking this way also makes cost comparison honest: a 1 percent purchase fee at Relai and a spread-inclusive card purchase that quietly costs 4 percent are the difference of thousands of satoshis on the same deposit, which is easier to feel than a percentage.

Satoshis are also the unit of the fee market, and this is where beginners overpay or get stuck. Wallets ask for a fee rate in sat/vB, not a total. During quiet periods a few sat/vB clears the next few blocks; during a rush the same transaction can need ten times that. The record shows how far this can go: block 840,000, mined on April 20, 2024, collected about 37.6 bitcoin in fees, because thousands of people bid against each other for room in the halving block.

For Lightning users the unit is unavoidable. Channel capacities, routing fees, and invoices are all quoted in satoshis, and a Strike payment that costs one satoshi to route is a fee of a fraction of a cent. There is no dollar-denominated interface hiding underneath.

Working out what 50,000 satoshis is worth

Converting satoshis to a familiar currency needs one division and no calculator tricks.

Take the bitcoin price, divide by 100,000,000, and you have the price of one satoshi. At 100,000 dollars per coin that is 0.001 dollars, so 50,000 satoshis is 50 dollars. At 60,000 dollars per coin the same 50,000 satoshis is 30 dollars. Because the divisor never changes, the shortcut at a six-figure price is easy: 100,000 satoshis is about 100 dollars, and one million satoshis, sometimes written 0.01 BTC, is about 1,000 dollars.

Run the same arithmetic on a fee. A 141 virtual byte withdrawal at 4 sat/vB costs 564 satoshis, which is 56 cents at 100,000 dollars per coin and 34 cents at 60,000. The fee is fixed in satoshis and floats in dollars, which is the opposite of how people instinctively expect it to work, and it is why consolidating small amounts is cheaper when the fee market is quiet rather than when the price is low.

Satoshi vs Satoshi Nakamoto

A satoshi is a unit of account; Satoshi Nakamoto is the pseudonymous author who published the bitcoin whitepaper on October 31, 2008 and disappeared from public communication in 2011. Context normally disambiguates, but headlines about "Satoshi's coins" mean the roughly one million bitcoin mined in the network's first year and never moved, not the unit. When you see the word lowercase and pluralised as sats, it is the unit.

Satoshi vs denomination

A satoshi is one specific unit; denomination is the general practice of naming units at different scales. Bitcoin's denominations include the coin, the millibitcoin, the microbitcoin or bit, and the satoshi, and only the last of these is a real quantity in the protocol. The others are display conventions layered on top of the same integer count, which is why a wallet can switch between them without any transaction changing.