Bitcoin for Savers The basics

Sats, prices and volatility: saving in Bitcoin vs shillings

You don't need a whole bitcoin. Learn what sats are, why the price moves so much, and the questions to ask before saving in Bitcoin.

12 minBeginner2 / 8

Draft: this lesson is still waiting for review.

What you'll learn

Convert between bitcoin, sats and shillings using an example price
Explain what volatility means and why Bitcoin's price moves
Compare saving in shillings and in Bitcoin without assuming either will win

Key terms

sats: The smallest unit of bitcoin. One bitcoin is 100 million sats.
volatility (kupanda na kushuka kwa bei): How quickly and how far a price moves, up or down.
inflation (mfumuko wa bei): Prices rising over time, so the same money buys less.

Juma hears that one bitcoin costs millions of shillings and decides it is not for him. But nobody has to buy a whole bitcoin, just as nobody has to buy a whole cow to drink milk.

Sats: the small change of Bitcoin

One bitcoin is divided into 100,000,000 (one hundred million) sats. Most people save and pay in sats.

Here is an example, using a made-up price that is not today's price:

If 1 bitcoin costs	then 100 shillings buys
10,000,000 KES	1,000 sats
5,000,000 KES	2,000 sats

The working: 100 ÷ 10,000,000 × 100,000,000 = 1,000 sats.

Why the price moves

The price of bitcoin in shillings is set by people buying and selling every minute, all over the world. When more people want to buy than sell, the price rises; when more want to sell, it falls. News, fear and excitement all move it. Big, fast moves up and down are called volatility.

Bitcoin's volatility is much higher than the shilling's. Over a week, a month or a year, the shilling value of your sats can fall a lot, as well as rise. Over the long run, nobody can promise which way it will go.

Shillings and Bitcoin side by side

	Shillings	Bitcoin
Who issues it	Central Bank of Kenya	Nobody; fixed rules
How much can exist	Decided by the Central Bank	About 21 million, ever
Price in shillings	Always 1	Changes every minute
Main risk	Inflation slowly eats value	Big drops in the short term; losing your keys

Try it

Pick a made-up price, say 8,000,000 shillings for one bitcoin. Work out how many sats 50, 200 and 1,000 shillings would buy. Then check your answers with a friend.

Reflect

Write your answer down, or talk it over with a friend or your chama.

Which of your savings goals are for next month, and which are for five years from now?
How would you feel if your savings dropped by a third for a few months? What would you do?