What is a Satoshi (SATs)? How are they used?

Journey to your First Bitcoin: The Satoshi

Two years ago, everyone enjoyed the bull run up from 10K USD to 60K USD for Bitcoin. It was a euphoric pump in price that most people missed out on. Whether you achieved financial freedom or not, two things were clear:

1. People believe in BTC.
2. They are willing to trade their fiat for it.

Even after the market officially entered bear mode, BTC remains in a tug of war between 19K USD and 21K USD. It’s an expensive coin to say the least and most people don’t have 20K to spend.

What if I told you, however, that we could reach that coveted single BTC?

Let’s look at the denomination of a Bitcoin: The Satoshi.

What is a Satoshi?

The denomination of a bitcoin is known as a Satoshi, or a sat, named after the  creator of Bitcoin Satoshi Nakamoto. One bitcoin is comprised of one hundred million SATs or accounted as 0.00000001 BTC. Just like there are one hundred cents in a dollar or how there are ten jiao in a single yuan.

Why are Satoshi’s important?

As the price of a bitcoin increases, it makes less sense to make purchases in whole bitcoins if you’re using fiat as the measure of value. There is a metric used by Bitcoiners of SATs/dollar. The idea is that satoshis will be the default currency with widespread Bitcoin (BTC / USDT) adoption.

SATs in Action

Having a look around you’ll see most transactions are done in satoshis. There was a story where someone used full bitcoins to purchase pizza a decade ago, but that was back when it was a novelty.

Let’s briefly look at the uses of satoshis in the wild.

Fees

Fees in Bitcoin transactions are measured in satoshis, theoretically if there was enough demand for block space you could see full bitcoins used for fees, but for now it’s only SATs.

Higher fees will get your block confirmed faster and transactions are measured in SATs/vB (Virtual bytes). Block space isn’t measured in amount of bitcoin transacted but in the amount of memory the other properties of a transaction take up. Think of it like gas in Ethereum (ETH / USDT) where the more computational steps involved the more gas is required to include the transaction in a block.

Miner Rewards

Another reason for satoshis is for the reward-halving that happens every 210,000 blocks, or roughly four years. At a certain point in the future miners will not receive a full coin for mined blocks but rather satoshis.

Lightning Network

The Lightning Network operates as a settlement layer for the Bitcoin network. It’s a way to scale Bitcoin without the block space market devolving into fees exceeding single digit bitcoins. Instead, fees are meant to be cheaper and spent with satoshis exclusively. This is the attempt to make satoshis the default unit of exchange while treating bitcoins like bars of gold.

Dollar Cost Averaging

The most popular way to enter the Bitcoin space is to DCA or dollar cost average. This simply means purchasing bitcoin at a consistent price on a consistent schedule. By doing that you’re purchasing price will average out despite the volatility of the price of a bitcoin.

Do it for long enough and you’ll get to a bitcoin.

Earn Satoshis by using AscendEX

Since mining is prohibitively expensive to most people and entering a mining pool is too much work for the casual retail user, AscendEX is releasing a way to earn satoshis and get users on their way to earning their first bitcoin!

The new user cryptocurrency rewards program offers retail traders opportunities to earn SATs for simply interacting (or completing quests) on the AscendEX website.

Users will be able to earn SATs as they browser the markets. New users will earn a signing bonus for creating an account on AscendEX. Hitting milestones like completing your first trade can also earn you SATs.

You’re on your Way with AscendEX

You don’t have to be a millionaire or own an entire bitcoin to be a part of the Bitcoin network. There is a lot you can do and accomplish with satoshis. You got this!