Satoshi (sat)

Bitcoin was designed with eight decimal places, so one bitcoin can be divided into 100,000,000 satoshis. The unit is named after Bitcoin's pseudonymous creator, Satoshi Nakamoto. Because bitcoin's price can be very high in fiat currency terms, pricing small transactions or fees in whole bitcoins produces unwieldy numbers — satoshis make those figures readable. Suppose a transaction fee is 0.00002100 BTC; expressed as satoshis that is simply 2,100 sats.

In market data, fees on the Bitcoin network are almost always quoted in sats per vbyte (virtual byte, a measure of transaction size on the blockchain). A higher sats-per-vbyte fee tells miners to prioritize your transaction. Watching this number gives traders a real-time signal of how congested the Bitcoin network is — a concept tied to how blockchains process transactions.

A common confusion is treating satoshis as a separate currency. They are not — they are simply a denomination of bitcoin, the same way cents are a denomination of a dollar. There is no conversion rate between sats and BTC; the relationship is fixed forever in Bitcoin's protocol. Another unit sometimes mentioned is the millisatoshi (one-thousandth of a sat), used internally by Bitcoin's Lightning Network for routing tiny payments, though millisatoshis never appear on-chain.

As crypto market cycles move prices, some analysts prefer to denominate altcoin prices in satoshis rather than dollars, because it shows how a token is performing relative to Bitcoin itself rather than relative to fiat currency.