Taking a look at the units used by various cryptocurrencies gives some insight into their history and how they’re being used.
Most cryptocurrencies use some form of metric (now officially the International System of Units, or the abbreviation SI from the original French Système International d’Unités) prefixes to denominate their currencies, so it’s worth first taking a look at those prefixes. The International System of Units has defined the prefixes such as centi for 1/100, milli for 1/1000, kilo for 1,000, and giga for 1,000,000. We use these all the time such as for centimeters or kilograms. These are not used as much in the United States, although for those who use computers they know kilo-, mega-, giga-, and terabytes (even though these are not strictly speaking metric as they are multiples of 1024 bytes, not 1000). Here are the SI prefixes and the numbers they are associated with:
SI Units
| Prefix | Symbol | Number | Scientific Notation | Short Scale Name |
|---|---|---|---|---|
| yocto | y | 0.000000000000000000000001 | 1E-24 | septillionth |
| zepto | z | 0.000000000000000000001 | 1E-21 | sextillionth |
| atto | a | 0.000000000000000001 | 1E-18 | quintillionth |
| femto | f | 0.000000000000001 | 1E-15 | quadrillionth |
| pico | p | 0.000000000001 | 1E-12 | trillionth |
| nano | n | 0.000000001 | 1E-09 | billionth |
| micro | μ | 0.000001 | 1E-06 | millionth |
| milli | m | 0.001 | 1E-03 | thousandth |
| centi | c | 0.01 | 1E-02 | hundredth |
| deci | d | 0.1 | 1E-01 | tenth |
| 1 | 1E+00 | one | ||
| deca | da | 10 | 1E+01 | ten |
| hecto | h | 100 | 1E+02 | hundred |
| kilo | k | 1,000 | 1E+03 | thousand |
| mega | M | 1,000,000 | 1E+06 | million |
| giga | G | 1,000,000,000 | 1E+09 | billion |
| tera | T | 1,000,000,000,000 | 1E+12 | trillion |
| peta | P | 1,000,000,000,000,000 | 1E+15 | quadrillion |
| exa | E | 1,000,000,000,000,000,000 | 1E+18 | quintillion |
| zetta | Z | 1,000,000,000,000,000,000,000 | 1E+21 | sextillion |
| yotta | Y | 1,000,000,000,000,000,000,000,000 | 1E+24 | septillion |
Cryptocurrencies for the most part try to use these prefixes, although different coins have different idiosyncrasies as to how they are used.
In general when using these names they are appended as prefixes to the primary name for the cryptocurrency, so milliether or microbitcoin, and the abbreviation is used in conjunction with the currency symbol, so mETH or µBTC.
Let’s take a look first at Bitcoin units:
Bitcoin Units
| Name | SI Abbr. | Nickname | Number | Scientific Notation |
|---|---|---|---|---|
| millisatoshi | mSAT | 1/100,000,000,000 | 1.0E-11 | |
| satoshi | SAT | 1/100,000,000 | 1.0E-08 | |
| finney | 1/10,000,000 | 1.0E-07 | ||
| microbitcoin | µBTC | bit | 1/1,000,000 | 1.0E-06 |
| millibitcoin | mBTC | 1/1,000 | 1.0E-03 | |
| centibitcoin | cBTC | bitcent | 1/100 | 1.0E-02 |
| decibitcoin | dBTC | 1/10 | 1.0E-01 | |
| bitcoin | BTC | 1 | 1E+00 | |
| decabitcoin | daBTC | 10 | 1E+01 | |
| hectobitcoin | hBTC | 100 | 1E+02 | |
| kilobitcoin | kBTC | 1,000 | 1E+03 | |
| megabitcoin | MBTC | 1,000,000 | 1E+06 |
Probably the most important thing to recognize is that the smallest unit possible in Bitcoin is 10e-8, or 1/100,000,000, called a Satoshi (after the creator of Bitcoin). Nobody knows why Satoshi Nakamoto chose 10e-8 as the smallest denomination. It’s an odd choice. 10e-9 would have been a more logical choice (keeping things in multiples of 1000).
The name Satoshi for that unit was not actually assigned by Satoshi the person (or group, who knows), but decided later by the Bitcoin community (see this post where it was originally suggested for 1/100 of a bitcoin in 2010).
Note that the smallest denomination which is in gray at the top of the table, millisatoshi, is not actually a denomination on Bitcoin. It is used only on the lightning network, and when transactions are recorded on the Bitcoin blockchain the number is rounded down to the closest Satoshi.
Looking at the nicknames, there are not many. Bitcent was once used more frequently, as a 1/100 of a Bitcoin. However, the introduction of Bit as 1/1,000,000 of a Bitcoin has become more useful as a unit, and the existence of Bitcent is therefore a bit confusing. Bit is useful because it’s hard to say you want someone to pay 0.00062 Bitcoins (about $5 as of writing) for a coffee, but a lot easier to say you want someone to pay 620 Bits. The introduction of Bit is useful because if you divide a Bitcoin by 1000 twice you get to a Bit.
In some places you can find the mention of a Finney for 10e-7 of a Bitcoin, which is intended to honor Hal Finney, but is not a very useful unit. It is also problematic since Finney is used more commonly as an Ethereum unit (see below). Like a Satoshi, it can’t be named using a metric designation from a Bitcoin. That’s why a Satoshi has it’s own designation as a SAT. A Finney could be considered a decasatoshi, or daSAT, but I don’t think anyone would find that useful which is why those are not in the table above.
In general, people will use variations of Bitcoin when discussing amounts close to a single Bitcoin, will use Bits when discussing a small amount for a payment, and only use Satoshis when discussing fees and other micro payments used in the blockchain.
Now let’s take a look at how Ethereum handles units:
Ethereum Units
| Name | Nickname | SI Name | SI Abbr. | Fraction | Scientific Notation |
|---|---|---|---|---|---|
| Wei | attoether | aETH | 1/1,000,000,000,000,000,000 | 1.0E-18 | |
| Kwei | Ada | femtoether | fETH | 1/1,000,000,000,000,000 | 1.0E-15 |
| Mwei | Babbage | picoether | pETH | 1/1,000,000,000,000 | 1.0E-12 |
| Gwei | Shannon | nanoether | nETH | 1/1,000,000,000 | 1.0E-09 |
| Twei | Szabo | microether | μETH | 1/1,000,000 | 1.0E-06 |
| Pwei | Finney | milliether | mETH | 1/1,000 | 1.0E-03 |
| Ether | Buterin | Ether | ETH | 1 | 1 |
| kEther | Einstein | kiloether | kETH | 1,000 | 1E+03 |
| Mether | megaether | METH | 1,000,000 | 1E+06 | |
| Gether | gigaether | GETH | 1,000,000,000 | 1E+09 | |
| Tether | teraether | TETH | 1,000,000,000,000 | 1E+12 | |
| Pether | petaether | PETH | 1,000,000,000,000,000 | 1E+15 | |
| Eether | exaether | EETH | 1,000,000,000,000,000,000 | 1E+18 |
The first thing you might notice is that the smallest possible unit of Ethereum is significantly smaller than that of Bitcoin. The smallest unit is 10e-18, or 10,000,000,000 times smaller than the smallest unit of a Bitcoin. That unit is called a Wei, named after cryptocurrency pioneer Wei Dai (who proposed a digital currency before Bitcoin and Ethereum called B-money). Ethereum units start with Wei up until they get to a full Ether, and then continue with variations of Ether. For example, a billion Wei are called a Gwei (giga-wei). This same denomination can be called a Nanoether, which is a billionth of an Ether. Recognizing that it’s easier to deal in whole numbers instead of decimals, smaller amounts tend to use the variations of Wei (in a similar fashion to how smaller amounts of Bitcoin can use Bits).
In addition to the Wei and Ether variations, there are also a plethora of nicknames used for Ethereum. A Kwei/Femtoether is nicknamed an Ada, after Ada Lovelace (considered by many to be the first computer programmer). A Twei/microether is nicknamed a Szabo, after Nick Szabo who proposed a digital currency before Bitcoin called bit gold, and developed the idea of smart contracts that are central to Ethereum. Click on the names in the table above to go to the Wikipedia pages for each person who inspired an Ethereum unit nickname. Keep in mind that these are not, with the exception perhaps of Wei, official unit names but rather commonly used nicknames. If someone were to create printed currency (perhaps a paper wallet containing one of these amounts) then one might imagine using pictures of one of these people on that paper.
The unit names correspond in some fashion to the nature of the community that surrounds the cryptocurrency. Ripple, whose XRP cryptocurrency is primarily targeted to trades between financial institutions, has no nicknames other than the term Drop to refer to its smallest unit, which is a millionth of an XRP. That the smallest unit is only a millionth of an XRP also reflects that fact that XRP is not intended for micropayments, but larger transactions.
To be honest, when doing transactions on blockchains, all of these units are essentially meaningless. Blockchain units are decimal representations of the primary unit (without getting into attempts to implement tonal and dozenal cryptocurrencies). So if none of these units exist on the blockchain, then why do they exist at all? They exist to make payments easier for the end-user. For individuals trying to pay one another it’s easier to say you want to be paid 620 Bits or 29 Finneys for a coffee, than 0.00062 Bitcoins or 0.029 Ethers. Of course, don’t get the Ethereum Finney (1/1,000 of an Ether) confused with the Bitcoin Finney (1/10,000,000 of a Bitcoin).
When developing wallets for storing cryptocurrencies, these units are useful in providing different ways of representing how much you are paying someone. It is, however, just a gloss on top of the decimal representation that is actually going to the blockchain. Right now many wallets will show you the conversion of the payment amount into a fiat currency like USD, as a kind of sanity check to make sure you’re paying the correct amount. Cryptocurrency purists may bridle at this fiat intrusion into their cryptocurrency wallets, but for most people this is a reasonable way to insure one is paying the correct amount. Imagine if the person who sold two pizzas in 2010 for 10,000 bitcoins (about $30 at the time) had a QR code on his web site still offering pizzas for the same price of 5,000 bitcoins each (about $40 million today)? That might be amusing from a historical point of view, but wouldn’t be very practical for someone actually trying to sell pizza. In fact if someone tried to buy two pizzas today for 10,000 bitcoin they would probably be investigated for money laundering. You wouldn’t want to accidentally pay 5,000 Bitcoins for a pizza, so until cryptocurrencies become a true replacement for fiat currencies, an easy way to compare the value of what you’re spending with a currency you use regularly is quite useful.
So at the end of the day there are really only a single unit for each cryptocurrency, and nice glosses in our wallets that may make it easier to make certain kinds of payments (even if they still use the single unit when making those payments).
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