Since I'm a newbie and this has probably been asked before, I thought I'd spam it to the Newbies section. Is there a good text, FAQ or similar on the reasoning behind the choice of the arbitrary numbers bitcoin is built on? Such as… why 21 million BTC rather than 1 or 5000 or 10 trillion? Why are they awarded in chunks of 50 rather than 0.1 or 1 or 210? Why is the smallest unit 10-8 BTC rather than 10-6, 10-9 or 10-10?
Some of the numbers were arbitrarily chosen by Satoshi simply because he thought they seemed like they'd be reasonable. Others are the result of mathematics based on the arbitrarily chosen numbers.
Numbers that appear to have been chosen arbitrarily because Satoshi felt like they were reasonable:
5 000 000 000 integer (no decimals) units rewarded per block in the beginning (these units are now commonly called "satoshis").
1 BTC = 100 000 000 integer units (resulting in the block reward being referred to as "50.00000000 BTC").
Difficulty is adjusted every 2016 blocks to keep the average block creation rate close to 2016 blocks per 2 weeks.
Block reward is divided in half (and any decimal portion is truncated) every 210,000 blocks (approximately every 4 years).
You can see from these arbitrary "rules" that the rest of the numbers you ask about can be calculated.
If you start with a reward of 5 000 000 000 and then cut the reward in half every 210 000 blocks (truncating the decimal portion), then the last 1 unit rewarded will be in block 6 929 999 which at a rate of 210 000 blocks every 4 years will be in the year 2140. If you add up all the rewards from all 6 929 999 blocks, you find that the total number of integer units that will be created is 2 099 999 997 690 000. Since 1 BTC = 100 000 000 integer units, this means that the total number of bitcoins that will be created is 20 999 999.97690000 which is close enough to 21 million that most people just say "21 million" instead of trying to remember the exact actual number that will be created.
The smallest unit is 10
-8 because the BTC designation was chosen to be 10
8 integer units. This resulted in a "reasonable sounding" 50 BTC for the initial reward. Satoshi could have just as easily chosen 10
7 integer units or 10
9 integer units to be designated as "a BTC", but that would have resulted in either a block reward of 500 BTC or 5 BTC. Satoshi felt like those numbers sounded too extreme.
