21 million cap

[kbriggs]

I just become aware of Bitcoin this week watching "Security Now" at Twit.tv. The main question I have about the system is why was 21 million bitcoins selected as the final cap?  Why not something more "round" like 100 million or 1 billion?  And why such a relatively small number?  I understand about the 8 decimal places giving you essentially 2.1 quadrillion tradeable units.  But the general public is not used to dealing with more than 2 decimal places in their currency. If the system took off to even the size of PayPal alone, a single bitcoin is going to be worth some huge number and we're all going to be buying things priced at inconvenient amounts like 0.00023, etc., right?

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[kiba]

You could use scientific notation or perhaps specific decimal point as default.

[davout]

I just become aware of Bitcoin this week watching "Security Now" at Twit.tv. The main question I have about the system is why was 21 million bitcoins selected as the final cap?  Why not something more "round" like 100 million or 1 billion?  And why such a relatively small number?  I understand about the 8 decimal places giving you essentially 2.1 quadrillion tradeable units.  But the general public is not used to dealing with more than 2 decimal places in their currency. If the system took off to even the size of PayPal alone, a single bitcoin is going to be worth some huge number and we're all going to be buying things priced at inconvenient amounts like 0.00023, etc., right?

21 million, purely arbitrary.
Also, you don't track units, you track available balances which conceptually allows for indefinite division, there's no such thing as a conceptual atomic bitcoin unit.

[FatherMcGruder]

I just become aware of Bitcoin this week watching "Security Now" at Twit.tv. The main question I have about the system is why was 21 million bitcoins selected as the final cap?  Why not something more "round" like 100 million or 1 billion?  And why such a relatively small number?  I understand about the 8 decimal places giving you essentially 2.1 quadrillion tradeable units.  But the general public is not used to dealing with more than 2 decimal places in their currency. If the system took off to even the size of PayPal alone, a single bitcoin is going to be worth some huge number and we're all going to be buying things priced at inconvenient amounts like 0.00023, etc., right?

0.00023 BTC = 0.23 mBTC.

[kbriggs]

You could use scientific notation or perhaps specific decimal point as default.

The average guy on the street has no idea what scientific notation is.

[davout]

You could use scientific notation or perhaps specific decimal point as default.

The average guy on the street has no idea what scientific notation is.

It is just as easy to transport 2000 bitcoins than 0.00002 bitcoins.
When money is immaterial it all boils down to notation conventions.

[kbriggs]

Also, you don't track units, you track available balances which conceptually allows for indefinite division, there's no such thing as a conceptual atomic bitcoin unit.

But if you're a merchant, you gotta post a price next to your product.  I'd rather there were 10 trillion bitcoins in circulation and I could post a price mostly in integers that my customers would understand.

[kbriggs]

It is just as easy to transport 2000 bitcoins than 0.00002 bitcoins.
When money is immaterial it all boils down to notation conventions.
[/quote]

Transportation isn't the issue. I'm talking about the market dynamic between merchant and customer. Average people who think "fractions are hard". Not the engineers and cryptologists that hang around here.

[kiba]

The average guy on the street has no idea what scientific notation is.

Really? I learn that in schools like...several time!

[FatherMcGruder]

The average guy on the street has no idea what scientific notation is.

Nor does the average guy know that the calories on your foods' nutrition labels is actually kilocalories. If a pint should ever cost 0.005 BTC, your bartender will ask you for "five mills" or something like that. He won't say "five thousandths of a bitcoin".

But if you're a merchant, you gotta post a price next to your product.  I'd rather there were 10 trillion bitcoins in circulation and I could post a price mostly in integers that my customers would understand.

If you ever have to sell something for millibitcoins, other merchants will probably have to do the same and customers will just come to expect it.

<inner physics teacher>Always include units though.</inner physics teacher>

[kbriggs]

The average guy on the street has no idea what scientific notation is.

Really? I learn that in schools like...several time!

Yes, really.  We're not normal, we're geeks.  Like everyone else reading this.

[kiba]

Yes, really.  We're not normal, we're geeks.  Like everyone else reading this.

I swear that everyone in school learned this stuff!

[grondilu]

The average guy on the street has no idea what scientific notation is.

Come on.  He doesn't know what a millimeter is?  He doesn't ever use words such as kiloWatt, kilogram, MegaHertz, GigaOctet, and so on? ...

[kbriggs]

Yes, really.  We're not normal, we're geeks.  Like everyone else reading this.

I swear that everyone in school learned this stuff!

I learned a lot of crap in school and retained it only to the next test.  Ask your mother if she knows what scientific notation is.

[FatherMcGruder]

Americans used to describe their currency in cents. Then as it inflated, people came to refer to dollars, Benjamins, and grands. Same thing with Bitcoin, except the trends will follow deflation.

[grondilu]

I learned a lot of crap in school and retained it only to the next test.  Ask your mother if she knows what scientific notation is.

Well, I guess anyone who is incapable of learning a few prefixes does not have much economic value anyway.  So I don't mind if these people don't use bitcoin.

PS.  If I ask my mother what scientific notation is, she will obviously say she has no idea.  But if I ask her how many millimeters there are in on meter, I'm pretty sure she'll have to give it about 10 seconds thought, but hopefully she'll come out with the right answer.

[marcus_of_augustus]

Millibitcoins
Microbitcoins
Nanobitcoins
Picobitcoins

I don't see an issue ... maybe just a small advantage for the scientifically literate who understand what the those things actually mean.

Bitcoin cent is kind of a mouthful ... centibitcoins or bitcents?

then it could get messy but still decipherful ... millibitcents, microbitcents, etc ... trying to know what terminology people will use for their monetary divisions or numbering is futile. Look at the UK billion and the US billion ... and how many people on the street even understand what a billion is .... they hear it but  ....?

[LZ]

1 BTC ≈ 1 USD now. Does someone have any problems with the 0.001 USD now?
I think not, because you can always sell enough goods to get at least 0.01 USD.
And, by the way, if bitcoin would cost too much, we can always move the point.

[kbriggs]

1 BTC ≈ 1 USD now. Has someone any problem with the 0.001 USD now?

Did you mean 0.01 USD?  Because many would have a problem if they saw a single item priced at a tenth of a cent.  But as FatherMcGruder said, people will likely adapt to a common nomenclature over time. I still think 21 million was an odd choice, though.

[LZ]

No, I meant exactly 0.001 USD. And it is not a problem because you can sell 10 pieces for 1 cent.