The Marketer's Argument For and Against Pricing Bitcoin in Sats

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There’s a quiet debate going on in the Bitcoin community about pricing Bitcoin on exchanges in units called “sats.” This debate has been going on for a while but has really taken off in this bull run, with smaller coins taking some of Bitcoin’s attention among newer investors.

This is a battle for The Sat Standard.

“Sats” is short for “Satoshis”. They’re named after Bitcoin’s anonymous creator, and are what we call the smallest unit of a bitcoin. Each Bitcoin is equal to 100 million Satoshis.

To put it in clear terms: Sats are to bitcoin what cents are to dollars.

Make sense?

The Argument for Pricing Bitcoin in Sats

So there is a lot of debate around the question of Bitcoin vs. Sats. And this argument actually has a lot of good points to make.

The core of this side of the debate is around unit bias.

Here's the gist of it: New crypto investors log onto an exchange and see that one whole bitcoin costs $40,000. But they could instead buy one whole Ether for $2500. Or one whole Litecoin for $180.

You see where this is going.

This actually happens. I know a number of first-time crypto investors who bought Ether or Cardano or whatever else instead of Bitcoin for this sole reason.

Where Bitcoiners have struggled is in communicating the fact that you don’t have to buy one whole bitcoin. You can buy a fraction of a bitcoin. Poll the average newbie and you’ll find that they don’t know that, which is surprising in a reality where fractional stock investing is commonplace.

My friend Jack, a relative newcomer to the space, also makes a good point. It’s hard to understand what a fraction of a bitcoin really is. For a lot of people the utility of Bitcoin is still vague beyond the promise of digital gold and a shield from inflation.

So there you have it -- the main narrative here is that pricing Bitcoin in sats fixes this unit bias issue. For a lot of people, having 100,000 Sats is more exciting than having 0.001 BTC.

The Argument Against Pricing Bitcoin in Sats

But what about the other side of the argument? What do people have against transitioning to pricing Bitcoin in Sats?

So this guy is arguing exactly the opposite of Team Unit Bias. They’re saying that pricing Bitcoin in a way that is visually closer to the majority of altcoins will hurt Bitcoin by cheapening it. It’ll no longer look like the market-leading asset that it is. And I think there’s definitely something to that.

Another argument is that pricing things in sats creates relative visual scale, making small amounts (like transaction fees) look like massive costs. In this example, an $8 transaction fee is suddenly appears to be a costly sum.

Something to think about.

The Marketer’s Take on Pricing Bitcoin in Sats

The whole anti-Sat Standard argument, in my opinion, is about branding. Bitcoin’s whole identity is that it’s the original cryptocurrency. The standard setter. The one whose price is so much more than the others.

Switching to the Sats standard also does hurt long-running memes, like the 21 million BTC scarcity value proposition, which is also the main feature of Bitcoin’s anti-inflation narrative. Again, even though this doesn’t change the fact that there will only ever be 21 million BTC, it’s a perception thing.

And speaking as a marketer, the thing Bitcoin has going for it over most other cryptocurrencies in the eyes of first-time investors is its name. If every exchange suddenly switched Bitcoin to Sats, I would put money on the fact that consumer trading volume would decrease significantly.

This also touches on the pain point of Bitcoin Cash arguably grifting new investors because the name sounds like Bitcoin, even though it’s a completely different asset. Remember when Bitcoin.com used to sell BCH under the name Bitcoin? Yeah.

At the same time, the Sats Standard argument has a lot going for it, too. Bitcoin as electronic cash is a lot simpler to price and understand when you’re talking in satoshi’s.

Owe someone some cash for a beer they bought you? That’ll be 13.6K Sats (rather than 0.000136 BTC). Of the two, Sats is easier. I’d even like to see what happens if we define a term for thousands of sats to continue making this easier to use.

Unit bias is a real thing and has led to a lot of younger investors putting thousands of dollars into assets like Dogecoin and others in the hopes of getting rich quick.

Ultimately, I think that if hyperbitcoinization does happen, moving to Sats as the primary, everyday denomination of Bitcoin is inevitable. But I also think that we’re quite some time away from that being a reality. We’ll just have to wait and see what comes next.