"Pack of gum? That'll be 0.0009 bitcoins"
These days, prices expressed in bitcoins can be quite cumbersome. That's because the price of a single bitcoin in recent months has been anywhere from several hundred dollars to over one thousand dollars.
In response to this, quite a few people have taken to discussing prices in "millibits" or mBTC. So instead of saying "one bitcoin is $800", they say "one millibit is $.80".
In fact, the commonly accepted Bitcoin nomenclature looks something like this:
- 1 x 10^0 BTC = 1 bitcoin
- 1 x 10^-3 BTC = 1 millibit
- 1 x 10^-6 BTC = 1 microbit
- 1 x 10^-8 BTC = 1 satoshi
There are a few glaring problems with this system, however - a big one is that all of the names are difficult to remember and say, which can be a large hindrance to adoption.
Let's try pronouncing one of these names:
Hm, that was a bit rough. The name has too many syllables, hardly rolls off the tongue, and still emphasizes that we're dealing with fractions of a whole ("milli" means "1/1000th of").
So... I would like to propose a new system - one that is much simpler and easier to remember and say:
- 1 x 10^0 BTC = 1 megabit = 1 bitcoin
- 1 x 10^-3 BTC = 1 kilobit
- 1 x 10^-6 BTC = 1 bit
- 1 x 10^-8 BTC = 1 centibit = 1 satoshi
With this system, the basic unit of measure is the "bit."
One million bits is a "bitCOIN," much like 400 troy ounces of gold is a "gold bar."
Here, "coin" is short hand for "one million of."
Last, the commonly accepted "satoshi," or 10^-8 BTC, is just a centibit, or "one one-hundredth of a bit." In this sense, the satoshi is to the bit as the cent is to the dollar.
So now that we've gotten that out of the way, let's take this for a test drive and see how it sounds:
- buying a cup of coffee: "that'll be 5,000 bits"
- buying an international flight: "it was 2 bitcoins!" (or 2 million bits)
- tipping an author for a blog post: "here's 300 bits"
How'd that sound? Good, right?
The best part is that this system is quite future-proof. These numbers will go down as Bitcoin rises in value, but even if Bitcoin surpasses gold as a store of value and becomes the global reserve currency, a unit of measure equivalent to 10^-6 bitcoins will still be a useful unit of value.
So... if you like this idea and you think we should adopt this new system, I encourage you to tell your friends.
As advocates of bitcoin and members of this brilliant community, it is up to us to make it as easy as possible to "think in bitcoin" and foster user adoption.
Like this system? Think it's flawed? Have a suggestion? I'd love to hear your thoughts - just drop me a line on twitter or leave a comment below.