Perspective | Adjusting Bitcoin Units Could Be the Key to a Bull Market

Source: LongHash

As of today, I believe most people have heard of "Bitcoin" to some extent. Despite mixed reviews, from time to time, you will see some news about "Bitcoin" in various media. For most people, it is difficult to understand why a "bit" bitcoin is worth more than 10,000 US dollars, about 70,000 yuan. Whether bitcoin is worth so much money is not discussed in this article. I wonder if anyone noticed that when we are discussing bitcoin in Chinese, many people like to use "a" as the quantifier of bitcoin. This is often the source of many misunderstandings.

In fact, if you think about it a little bit, you can think of "pieces" as obviously cannot be used as money or other items that can be accurately measured. We won't talk about a yuan or a gold. If "a" is used as the quantifier of bitcoin, there will be some misunderstandings. For example, there are many people who do not know much about bitcoin, and think that bitcoin is purchased by "a". Although there are various reasons for this misunderstanding, which will be discussed later, part of the reason is also due to the quantifier "ge". Generally speaking, in Chinese, "ge" is generally used for the relatively "complete" concept, without any distinction between size and size. You can say an apple or an earth. Many people think that the price of bitcoin is too expensive, so they can't buy it, instead of knowing that in Bitcoin, this so-called "unit" is a very large unit.

In addition, there is a completely opposite "misunderstanding". Although it is rare now, there was a time when it was because of the use of "ge" in Chinese, which made many people say "infinite division" of Bitcoin Questioned the characteristics of the "unlimited division" means that there is no upper limit. For example, one "one" bitcoin can be changed into ten "one" 0.1 bitcoins. In the Chinese environment, some people think that this is one "one" and it becomes 10 "one". It is because "ge" in Chinese makes it easy to ignore the size of its unit of measurement, so this misunderstanding is caused.

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Therefore, the author believes that the best way to eliminate these misunderstandings is to try not to describe Bitcoin in the Chinese environment. Because "Bitcoin" itself is a unit, you can directly add "Bitcoin" to the number when you usually refer to currency. It may be difficult to get used to at first, but considering the possible disadvantages and misunderstandings, it may be very helpful for others to understand.

It can be noticed in the English context that everyone directly uses btc as a unit, so usually 1 btc is used directly. Many people know that the smallest unit of Bitcoin is satoshi, and Chinese is "Cong", which is derived from Satoshi of the name Satoshi Nakamoto (Satoshi Nakamoto) used by the founder of Bitcoin. 1 btc = 100000000 satoshi, which means that 1 bitcoin is 100 million satoshi. In addition, according to the ISO standard currency code, the unit of Bitcoin in international standards will be marked as XBT. This can be seen in large European and American exchanges. Generally, XBT is used instead of BTC.

According to common classification specifications, there are many other smaller units, such as cBTC (bits), mBTC (millibits), μBTC (microbits), and bits. The correspondences are as follows:

1 cBTC = 0.01 BTC

1 mBTC = 0.001 BTC

1 μBTC = 1 bits = 0.000001 BTC

1 satoshi = 0.00000001 BTC

It is often compared with bitcoin and gold, thinking that bitcoin can be regarded as "digital gold". Of course, the analogy of gold with the current volume of bitcoin is a bit too exaggerated, but it does not prevent us from only comparing the units.

As we all know, the upper limit of the number of Bitcoins is 21 million BTC. The amount of gold that has been mined around the world is about 170,000 tons. If you directly compare the order of magnitude of bitcoin to gold, then 1 btc is about a unit of "hundred kilograms", which shows that 1 btc is also a very large unit. The common price of gold is calculated in "grams", which shows that we may be able to measure the usual bitcoin price with some smaller units. Judging by the magnitude difference from "hundred kilograms" to "grams", maybe bits is a good choice.

In fact, as early as 2013, some people called for the common unit of bitcoin to be adjusted to bits. The earliest follow-up was Bitpay. After that, similar to Coinbase, users began to choose to use bits to display prices. After 2017, there have been repeated suggestions that the community can adopt bits as the default display unit for bitcoin prices. As of today, many exchanges support that users can choose to use bits as the unit of price display, but this is often not the default option.

Considering that the price of 1 btc is 10,000 USD, the price of 1 bit is 0.01 USD, which is about 0.070 yuan. Do you feel that the price is close to the people? Some people may say that just changing one unit and changing the soup without changing the medicine is the same as Chao Miu Si or Chao Miu San. Is it necessary to spend so much effort to adjust?

In fact, the effect of price display is still relatively large. The most well-known case is the "non-integer pricing method (also known as the mantissa pricing method)", that is, everyone can almost see a large number of commodity prices in the market, and the end is often 9, such as often see 0.99 after the decimal point, or the price is 1499 yuan.

Many people have ridiculed this method as a chicken thief method, and feel it is completely unnecessary. Yuan Yuan, a senior vice president at Apple Computer, then joined Ron Johnson, JCPenney, the largest chain department store in the United States, and Luo Yonghao, a recent hammer phone, tried to refuse to use this pricing method, but in the end it seemed All have been hit by the market and have to change back to this way. Both theoretical analysis and market results have proven that small changes in these numbers can have a significant impact on consumer buying behavior. Then, by modifying the bitcoin price display unit, the display price may drop significantly, which may have a significant psychological impact on potential investors.

In addition, I don't know if you notice that many exchanges and market software are designed according to the stock trading system. By default, the price displayed by the stock trading system is the unit price of the stock, that is, the price of each share, and this is the smallest unit of stock trading and is indivisible. Therefore, it is likely that this habitual thinking will allow many people familiar with stocks to apply this thinking to Bitcoin transactions. For those who have just come into contact with Bitcoin, it is easy to think that this is the smallest unit of Bitcoin trading, and the unit price of 60,000 to 70,000 will definitely discourage many potential investors.

The change shows that the unit is actually not a rare behavior. In the traditional financial market, this behavior is also very common, and it usually manifests as a "split stock" in the stock market. When the price of a stock continues to rise, the high price is likely to affect the purchasing desire of investors, especially retail investors. At this time, companies often consider splitting stocks. This logic is exactly the same as the modification display unit.

Bobby Lee of the BTCC platform has repeatedly suggested that the industry needs to change the common unit of bitcoin to mBTC (μBTC, 9 mBTC at 9,000 US dollars), but it has not been approved by most people, and many people are not opposed to modifying the common unit Instead, there are some different suggestions. Some people suggest using satoshi to display directly, but there are still many people who propose to use bits (μBTC, 0.009 bits for 9,000 US dollars). Bobby Lee believes that the price of bitcoin was already high at that time. Changing to mBTC can make it more acceptable, and the proponents of proposed bits believe that it is a big thing for the industry to modify common units. High, it is easy that mBTC will no longer be suitable, it is better to modify it directly to bits.

When writing, I asked Li Lin, the founder and chairman of the digital currency exchange Huobi, respectively. Li Lin said that he has no objection. "It mainly depends on market acceptance. If it is to be implemented, a user survey and voting may be done first. "

Therefore, if the entire industry can work together to change the bitcoin unit into bits, it may have a great impact on many people who are still waiting to see and do not understand, at least for those investors who simply believe that the unit price of bitcoin is too high. Has a greater impetus. Obviously, the price of bitcoin has been hovering for a long time. The big reason is the lack of new investors. Unlike before the last bull market (such as around 2015), the unit price of bitcoin must have scared many people. The necessary condition for the bull market to open is that a large number of new investors can participate, and adjusting the bitcoin display unit is likely to become the key to open the bull market.

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