Bitcoin Divisibility and Decimal Places?

in bitcoin •  8 years ago 

Bitcoin has a maximum cap of 21,000,000 units. However, we are well aware we are not forced to buy integer amounts of Bitcoin. We can buy and exchange fractional amounts.

When I open a wallet, I can see the Bitcoin quantity expressed to eight decimal places.
To what tolerance is Bitcoin measured?
Is that the smallest possible unit for a Bitcoin to be measured, to eight decimal places? I don't know.
At some point, Bitcoin must be limited to discrete units, if it is recorded and displayed in (finite) decimal form.

Given eight decimal places, that means there can only ever be 21,000,000 divided by 0.00000001 units of Bitcoin which equals 2.1 x 10^15 units, or 2,100,000,000,000,000 units or 2.1 quadrillion units.

Does this matter now?
No.
Given the current (approximate) price of Bitcoin at $1900, the smallest unit of 0.00000001 will equal 0.0019 cents. That effectively rounds to zero.

Will it matter in the future?
Hardly.
If Bitcoin reaches $1,000,000, per coin, the smallest unit of 0.00000001 will equal 1 cent.
That's the smallest possible unit of exchange for which most people should be able to grasp.

Why does any of this matter?
It probably doesn't.
Your high school maths teacher once would have tried to explain the difference between discrete and continuous data. If you found that dull, then no doubt, you would find it equally as dull to divide Bitcoin into levels of absurdity.

:)

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Nice information. Thanks for sharing!

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