Understanding Bits in Bitcoin
To function as a practical unit of exchange rather than purely speculative, Bitcoin, like any currency, needs to be divisible.
Subdivision became particularly important as the price of Bitcoin rose dramatically.
Bitcoin has a well-established system of subdivisions, and it is divisible up to eight decimal points.
There are several widely accepted classifications for Bitcoin sub-units.
A deci-bitcoin (dBTC) represents 0.1 of a coin, while a centi-bitcoin (cBTC) represents 0.01.
Simplifying Bitcoin’s Path to Mass Adoption
The adoption of “bit” as the standard subdivision emerged from a proposal initially published on the Bitcoin subreddit.
The proposal suggested dividing each coin into one million units, called bits. Using bits as a subdivision offers several advantages.
Furthermore, the simplicity of bits is expected to make it easier to understand and work with as a unit of value, even if Bitcoin prices experience significant increases.
This is because it aligns with the subdivision format used by most global currencies.
Agreement on subdivisions is essential to Bitcoin’s path toward mass adoption.
To become widely accepted as a payment method for real-world goods and services, Bitcoin needs to be easily understandable for average consumers.