The satoshi is the lowest unit of bitcoin currency that has been recorded on the blockchain so far. One Bitcoin can be divided into one hundred millions Satoshi, such that a single satoshi is equal to 0.00000001 BTC. Satoshi Nakamoto, the original creator of Bitcoin, is commemorated by the unit’s name.
Before being converted for display, all sums in the blockchain are denominated in satoshi. When specifying a bitcoin amount, the source code also utilizes satoshi. The amount is displayed in satoshi for readability when presenting an extremely precise fraction of a bitcoin, such as when calculating a fee per byte or a faucet payout. Although the satoshi coin is the smallest quantity that can be recorded in the blockchain, payment channels may need to make extremely precise payments and are occasionally priced in millisatoshi, which are one hundred billionths of a bitcoin.
Many newcomers struggle to overcome their unit bias when it comes to Bitcoin, meaning that they aren’t comfortable holding fractional amounts of Bitcoin. By using the satoshi denomination, we’re able to overcome the unit bias and make more people comfortable holding Bitcoin. For example, instead of saying that $300 buys you 0.001 Bitcoin, we say that $300 is all you need to become a satoshi millionaire.