Satoshis, bits and BTC: bitcoin's units explained (and why you don't need a whole bitcoin)

Bitcoin prices are usually quoted for one whole coin, which can make it feel out of reach. But almost nobody buys a whole bitcoin. You can buy, hold and send small fractions, down to a hundred-millionth of a coin.

This guide explains bitcoin’s units, how to convert between them, where you’ll see each one, and why the satoshi has become the unit many people prefer.

The satoshi: bitcoin’s smallest unit

Bitcoin Core, the reference software for the bitcoin network, records every amount in satoshis, and defines one bitcoin as 100,000,000 satoshis. So:

• 1 BTC = 100,000,000 satoshis
• 1 satoshi = 0.00000001 BTC

The White House’s 2025 digital assets report describes the “sat” as short for “satoshi”, the smallest possible unit of bitcoin the network can accommodate. Bitcoin.org adds that the unit is named after bitcoin’s pseudonymous creator, Satoshi Nakamoto. That’s where the phrase “stacking sats”, buying small amounts regularly, comes from.

How the blockchain stores amounts

You may see “0.0015 BTC” in your app, but that’s only how it’s displayed. The Bitcoin developer documentation shows that each transaction output stores its value as a whole number of satoshis. There are no fractions of a satoshi on-chain, and decimals in BTC are just a convenient way to show those numbers to people.

That’s also why the sum matters: a transaction’s outputs can’t exceed the satoshis it spends, and whatever is left over goes to the miner as the fee. See block explorers for how inputs, outputs and change appear on-chain.

All the units at a glance

Bits come from BIP 176, a Bitcoin Improvement Proposal that defines 1 bit = 100 satoshis, a millionth of a bitcoin. It notes that Bitcoin Core’s interface already offered the equivalent µBTC unit, and that there’s no obligation to switch. In practice, many apps simply show BTC or sats.

Converting, with examples

The math is simple once you remember 100 million:

• BTC to sats: multiply by 100,000,000. For example, 0.005 BTC = 500,000 sats.
• Sats to BTC: divide by 100,000,000. For example, 25,000 sats = 0.00025 BTC.
• Sats to dollars or pounds: price of 1 BTC ÷ 100,000,000 × number of sats.

As an illustration only: if one bitcoin were worth 100,000 in your currency, one satoshi would be worth 0.001, and 1,000 sats would be worth 1.

Why smaller units help

BIP 176 sets out the case for using smaller units. Its author argued that, as bitcoin’s price rose, small amounts gained so many decimal places that it was hard to spot being off by a factor of 10. It listed benefits including:

• fewer errors with small amounts;
• less “unit bias” for people who feel they need a whole bitcoin;
• easier price comparisons with ordinary currencies.

Whatever unit you use, double-check amounts and decimal places before sending. See how to send crypto safely.

Where you’ll see sats: fees

Bitcoin fees are usually quoted as a fee rate, in satoshis per virtual byte (sat/vB). Bitcoin Core introduced fee-rate options in sat/vB in version 0.21.0, replacing the older BTC per 1,000 vbytes, and warned that the two units differ by a factor of 100,000, so mixing them up would be a big mistake.

Because fees depend on transaction size rather than the amount sent, a payment of a few thousand sats can cost the same fee as one of several bitcoin. See bitcoin transaction stuck? for how fee rates affect confirmation.

As an illustration: a transaction of 200 virtual bytes at a fee rate of 10 sat/vB pays 2,000 sats. The same transaction at 2 sat/vB pays 400 sats, but may take longer to confirm when the network is busy.

“Dust”: when sats are too small to move

There’s a practical floor to how small an on-chain payment can be. Bitcoin Core’s code explains the idea: if you’d pay more in fees than an output is worth just to spend it later, that output is “dust”. Nodes running Bitcoin Core’s default policy generally won’t relay transactions that create dust outputs.

The code gives the thresholds at its default dust rate of 3,000 sat per kilo-virtual-byte:

Two practical points follow:

• Tiny balances can get stuck. If a wallet holds lots of very small amounts, spending them can cost more in fees than they’re worth.
• Platforms set their own minimums. Exchanges and wallets usually have minimum withdrawal amounts above these thresholds. Check before sending small sums.

Lightning and millisatoshis

On the Lightning Network, payments can be tracked in even finer amounts. Its invoice specification, BOLT 11, writes amounts in bitcoin, not satoshis, followed by a multiplier letter:

The 20m and 2500u amounts come from the specification’s own example invoices, which start with lnbc for bitcoin mainnet. Because Lightning payments are denominated in millisatoshis, BOLT 11 requires pico amounts to end in zero, so the smallest amount is effectively a thousandth of a satoshi. These tiny amounts are handled within Lightning; anything that settles on the main bitcoin blockchain is still in whole satoshis. See the Lightning Network explained.

Payment links and QR codes

When someone shares a bitcoin payment request as a link or QR code, it often follows BIP 321, which replaced the older BIP 21. It looks like this: bitcoin:<address>?amount=0.001. BIP 321 says the amount must be in decimal BTC, with a period as the decimal separator and no commas, so amount=50 means 50 BTC, not 50 sats.

Most wallets read this for you and show the amount in your chosen unit. Still, if your wallet displays sats and the request was in BTC, or the other way round, a misplaced decimal is easy to miss. Check the amount in your own currency before you confirm.

The 21 million limit

Bitcoin’s supply is capped at 21 million coins, which works out at 2.1 quadrillion satoshis. Bitcoin Core also uses 21 million BTC as an upper limit on any valid amount, and its code notes that the actual total supply happens to be slightly less than 21 million for various reasons. For how new coins are issued, see the bitcoin halving explained.

Buying fractions in practice

• Most platforms let you buy a set amount of money’s worth, for example 50 dollars or pounds, and credit you the corresponding fraction of a bitcoin.
• Taxes work the same whether you own a whole coin or a few thousand sats: selling or swapping any amount can create a gain or loss. See US, UK and Canada crypto tax.
• Small, regular purchases are one way people “stack sats”. See dollar-cost averaging.

New to bitcoin? Start with what is bitcoin? and how to buy your first bitcoin safely.