What is Bitcoin
The Bitcoin protocol was created in 2009 by an individual or group of individuals using the pseudonym Satoshi Nakamoto and has quietly grown to over 1 million bitcoin owners in just 14 years.
In short, Bitcoin (BTC) is a digital currency and a decentralized payment system that allows for peer-to-peer (from one electronic device to another) transactions without the need for a middleman or central authority (censorship-resistant).
This means that anyone with an internet connection can access the Bitcoin network. And given that 1.4 billion people worldwide don't have access to the banking system, Bitcoin adoption is growing the fastest among oppressed populations (moral).
Bitcoin transactions are encrypted and recorded on a public ledger called the blockchain, secured by tens of thousands of connected computers across the globe (nodes) that validate the transactions before committing them to the public ledger (transparent and private at the same time).
And unlike paper money governments keep printing more of (inflationary), Bitcoin has a fixed supply of 21 million coins (inflation resistant). Currently, ~19.30 million bitcoins are in circulation, with the 21 million maximum expected to be reached in 2041.
To help you fully understand what Bitcoin is and how it can serve to fix our corrupt and broken paper monetary systems, here is a list of the helpful resources I used while conducting my research for creating the calculator on this page:
- Free Book: Inventing Bitcoin: The Technology Behind the First Truly Scarce and Decentralized Money Explained, by Yan Pritzker
- Book: The Bitcoin Standard, The Decentralized Alternative to Central Banking, by Saifedean Ammous
- Book: Check Your Financial Privilege: Inside The Global Bitcoin Revolution, by Alex Gladstein
- YouTube Video: What is Bitcoin?, by Crypto Casey
I also watched numerous YouTube videos about Michael Saylor, Max Keiser, and Anthony Pompliano.
But perhaps the best way to learn about Bitcoin is to get a little skin in the game by buying a small amount. I was lucky enough to stumble across Swan Bitcoin during my research, which made it super easy to get started. They only deal in Bitcoin and are committed to helping new users take baby steps toward becoming comfortable using it. I was so impressed with Swan that I became an affiliate to help spread the word.
Regardless of whether or not you decide to show your support for Bitcoin's adoption, I hope you will at least make sure it's a fully informed decision. If Bitcoin eventually becomes the global reserve currency, your decision may have a massive impact on your family's financial future ... for generations to come (see Luke Broyles eye-opening presentation: https://www.youtube.com/watch?v=695SjcxoejY).
Depending on who you talk to, by the year 2030, the price of Bitcoin could go to zero or rise to 1.7 million dollars. So if you have $100 to risk at its current price of ~$22,000 per coin, your $100 worth of bitcoin (454,545 satoshis) could be worth between $0 and $7,727 (your $100 in USD may lose 50% of its purchasing power by then).
Important: As with any investment that carries risk, do your own research and only invest with money you are willing to lose.
What is a Satoshi?
A satoshi is the smallest unit of measurement for the digital currency, Bitcoin. It is named after the pseudonym used by the creator of Bitcoin, Satoshi Nakamoto. Bitcoiners often refer satoshis to as sats.
Specifically, one satoshi is equal to 0.00000001 Bitcoin. Conversely, 1 Bitcoin is equal to 100 million satoshis.
The satoshi is useful for smaller transactions, such as buying a cup of coffee or paying for small online services, and for people who want to own a small fraction of a Bitcoin without needing to buy a full one.
How to Convert Satoshi into Bitcoin
To convert satoshi to bitcoin, you can use the following formula:
For example, if you have 50,000,000 satoshis, the calculation would be as follows:
Bitcoin = 50,0000 x 0.00000001
Bitcoin = 0.5
How to Convert Bitcoin into Satoshis
To convert bitcoin to satoshis, you can use the following formula:
For example, if you have 0.5 bitcoins, the calculation would be as follows:
Satoshis = 0.5 ÷ 0.00000001
Satoshis = 50,000,000
How to Convert Bitcoin or Satoshis to US Dollars
To convert bitcoin or satoshis to US dollars, you first need to get the current price of 1 bitcoin. Many websites display the current price; the one I use to get the price for the calculator is coingecko.com.
Once you have the current price, you can use the following formulas to convert bitcoin or satoshis into US dollars:
For example, if the current price of 1 bitcoin is $21,820, and you own 0.00458295 bitcoin, the value of your bitcoin would be as follows:
Bitcoin Value in USD = $21,820 x 0.00458295 = $100
Or, if the current price of 1 bitcoin is $21,820, and you own 458,295 satoshis, the value of your satoshis would be as follows:
For example, if the current price of 1 bitcoin is $21,820, and you own 458,295 satoshis, the value of your satoshis would be as follows:
Satoshi Value in USD = $21,820 / 100,000,000 x 458,295 = $100
Stack sats and chill!