If BIP 177 passes, will your 1 BTC become 100,000,000 bitcoins?
Written by: KarenZ, Foresight News
In the Bitcoin ecosystem, the BIP 177 proposal is sparking a discussion about the accounting unit of Bitcoin, display methods, and the essence of user experience. This improvement proposal attempts to fundamentally reconstruct the way we perceive and use Bitcoin.
Additionally, Satoshi also mentioned early on that if Bitcoin experiences large-scale deflation in the future, software may display more decimal places. BIP 177 echoes this idea.
What is BIP 177?
BIP 177 (Bitcoin Improvement Proposal 177) is an improvement suggestion for Bitcoin aimed at redefining the accounting unit and display method for Bitcoin. The core idea of BIP 177 is to eliminate the decimal point display, making Bitcoin amounts more intuitive and easier to understand, thereby lowering the entry barrier for new users and promoting the adoption of Bitcoin in daily payments.
This related proposal was first put forward by Bitcoin enthusiast and Synonym CEO John Carvalho (@BitcoinErrorLog) on December 10, 2024, when it was hosted in the BitcoinAndLightningLayerSpecs/balls repository on GitHub, without a BIP number assigned yet. On May 8, the draft proposal for BIP 177 was officially merged into the Bitcoin BIP list. Currently, BIP-0177 is still in the draft stage and has not been formally adopted; community discussions are ongoing.
Specifically, BIP 177 proposes redefining Bitcoin's smallest indivisible unit (1 BTC = 100,000,000 basic units) as '1 bitcoin,' making the current 1 BTC equal to 100 million new 'bitcoins.' This change only involves the display method of the UI and will not result in any substantial changes to Bitcoin's (BTC) consensus rules, the total cap of 21 million coins, or the underlying logic of the blockchain ledger.
What is the purpose of the BIP 177 proposal?
The primary purpose of BIP 177 is to simplify the user experience of Bitcoin and resolve the confusion caused by the current unit display method.
Eliminating the complexity brought by the decimal point: Currently, the price of Bitcoin is usually displayed in BTC. Small transactions (like buying a cup of coffee) may involve numbers like 0.0001 BTC, and eight decimal places can confuse new users. BIP 177 proposes using the smallest indivisible unit as the base unit, displaying amounts as integers (e.g., 100 bitcoin instead of 0.000001 BTC), which is more intuitive for everyday currency use.
Educational value: Newcomers can directly understand Bitcoin as a discrete unit, rather than as a 'divisible decimal currency.'
Lowering the entry barrier for new users: Many people are unfamiliar with the term 'satoshi' and find it difficult to understand the conversion relationship of 1 BTC = 100 million satoshis. By redefining 'bitcoin' as the smallest unit, BIP 177 hopes to make it easier for ordinary users to understand and accept Bitcoin, especially in a high price context.
What are the pros and cons of BIP 177?
Potential Advantages
Simplifying user experience: Displaying amounts as integers (e.g., 100 bitcoin instead of 0.000001 BTC) is more intuitive and reduces confusion for new users caused by decimals.
Promoting the daily use of Bitcoin: By making small transactions easier to understand, BIP 177 is expected to drive the application of Bitcoin in the micro-payment field, enhancing its practicality as a currency. This could also encourage more merchants to accept Bitcoin, forming a circular economy.
Consistent with protocol logic: The proposal makes the UI display closer to the integer arithmetic method of the Bitcoin protocol, reducing the complexity of arbitrary conventions and enhancing technical transparency.
Low-risk adjustment: BIP 177 does not involve changes to consensus rules, requiring no hard forks or upgrades to miner nodes, only adjustments to the UI of wallets and exchanges. This means lower implementation costs and risks.
Expanding the user base: By lowering psychological and cognitive barriers, BIP 177 may attract more ordinary users into the Bitcoin ecosystem, especially among groups in developing countries or those unfamiliar with cryptocurrencies.
Potential Disadvantages and Challenges
Challenge of community acceptance: The Bitcoin community has a deep-rooted perception of 'Bitcoin' as the standard unit, and changing the unit name may spark controversy. Some users believe 'sats' is already a community consensus, and redefining 'bitcoin' could be seen as unnecessary complexity.
Confusion during the transition period: In the early stages of implementing BIP 177, different wallets and platforms may adopt different unit display methods (some using new bitcoin, others continuing with BTC or sats), which may lead to user confusion and even be maliciously exploited.
Cultural inertia: The popular 'satoshi' culture and terminology within the community may be affected.
Limited practical impact: Some critics argue that changing the unit display will have a limited effect on promoting Bitcoin adoption. Bottlenecks in user experience may stem more from transaction fees, confirmation times, or wallet usability rather than the unit name.
If passed, how will it be handled?
If the BIP 177 proposal is adopted, the overall conversion rule will be that the Bitcoin ledger and consensus rules remain unchanged. BTC as a currency code remains unchanged. The implementation of the new standard must multiply the original bitcoin value by 100 million to convert it to integer form. Specifically:
Unit redefinition: The base unit remains unchanged. The original 1 bitcoin = 100,000,000 base units; under the new definition, 1 bitcoin = 1 base unit.
Terminology change: Satoshi or sat will be discarded. All interfaces, documents, and displays should directly refer to the base unit as 'bitcoin.' 'BTC' remains unaffected, still representing 100 million base units.
Display and format changes: Applications should allow users to switch between the traditional format (1 BTC = 100 million base units) and the new format (1 bitcoin = 1 base unit). The symbol '₿' may be used to represent the base unit of bitcoin (₿ is optional).
Regarding satoshi and sat: They have cultural value, but official documents and interfaces should uniformly use 'bitcoin' as the only unit name.
The draft proposal document for BIP 177 provides the following examples:
Old display: 0.00010000 bitcoin → New display: ₿10,000 or 10,000 bitcoins or 0.00010000 BTC
Old display: 10.23486 bitcoin → New display: ₿1,023,486,000 or 1,023,486,000 bitcoins or 10.23486 BTC
Old display: 0.345 BTC → New display: No change, or ₿34,500,000 or 34,500,000 bitcoins
For developers, if BIP 177 is adopted, updates to interfaces, APIs, and documentation will be needed to display the base unit in integer form, retaining BTC as the larger unit. For users, the actual value of assets will not change; applications can assist in the transition through dual displays, prompts, etc. (e.g., displaying '0.0001 BTC = 10,000 bitcoins' simultaneously).
It is worth mentioning that regarding the 'bits' proposal (1 bit = 100 satoshis) raised for BIP 176, the proponents of BIP 177 believe that BIP 176 still relies on decimal thinking, requiring users to switch units, and does not resolve the contradiction between the protocol's integer nature and the display of decimals. In contrast, the integer solution of BIP 177 is more thorough and permanent.
Summary
BIP 177 aims to simplify user experience by redefining the basic unit, facilitating the use of Bitcoin in everyday transactions. Its core advantages lie in lowering the entry barrier for new users, aligning with protocol logic, and promoting the adoption of micro-payments, while the main challenges include community acceptance, confusion during the transition, and educational costs.
As a result, the BIP 177 proposal has sparked widespread discussion, with both supportive and opposing voices. Supporters believe BIP-177 can significantly improve the user experience of Bitcoin, especially in promoting small payments and widespread usage. Furthermore, redefining the accounting unit and display method for Bitcoin allows users to feel they 'own more bitcoin,' enhancing their sense of participation. Jack Dorsey, co-founder of Twitter and a long-time advocate for Bitcoin as a daily payment tool, also supports BIP 177 and states that 'sats' is absolutely the wrong term, hindering ordinary people from accessing and consuming Bitcoin.
Opponents argue that BIP-177 may cause confusion and even undermine Bitcoin's consensus and market perception, potentially leading users to mistakenly believe that the supply is inflating, shaking their trust in Bitcoin's scarcity.
It is worth mentioning that BIP-177 does not change the total supply, issuance mechanism, transaction fees, or other core economic parameters of BTC; it only adjusts the display method, having almost no direct impact on BTC prices (the actual value held by users will not change due to the redefinition of units). However, if BIP 177 is adopted, the price of 1 bitcoin will be proportionally reduced to 1/100,000,000 of the price of 1 BTC, but the actual value of the asset remains unchanged. For example, if 1 BTC = 100,000 USD, then under the new definition, 1 bitcoin = 0.001 USD. The indirect impact of BIP-177 on BTC prices depends on market sentiment and widespread user adoption. If it promotes user adoption and micro-payment prevalence, it could indirectly benefit prices through increased demand.
As a proposal that does not involve consensus changes, the implementation of BIP 177 is relatively straightforward, but its success depends on community consensus and the support of wallet developers. In the future, the Bitcoin community needs to weigh its pros and cons and decide whether to adopt it through open discussions. BIP 177 represents an important consideration in the evolution of Bitcoin: how to optimize user experience while maintaining protocol stability. The discussion on 'how Bitcoin should be understood and used by ordinary people' has significance that transcends the technical level, touching on the core issue of cryptocurrency adoption.
Reference: https://github.com/bitcoin/bips/blob/master/bip-0177.mediawiki
