When I Buy Bitcoin, What Am I Buying?

What is a Bitcoin, really? This is a question plenty of newcomers to the technology ask, and often, it’s the first question they will be googling. There are a lot of answers to it. Commonly, people might respond by saying:
‘A Bitcoin is a unique digital token that has value.’
And they’d be right.
But they’d also be wrong.
So let’s see if we can break it down a little bit by analyzing that sentence. Let’s start with the first word.
‘A.’ Well, that’s not quite right – a Bitcoin isn’t just a single unique digital token. It’s best to think of a Bitcoin as an amalgamation of 100 million satoshi. A satoshi is the nickname for the smallest currently usable unit on the Bitcoin protocol – equal to 0.00000001 BTC.

This post was published at Coin Report on 03 Sep 2014.

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