The smallest fraction of a Bitcoin you can buy is one one hundredth million of a bitcoin.
A bitcoin is made up of 100 million “satoshis”. Satoshis, named after Nakamoto Satoshi, are the fractional parts that make up bitcoin. Bitcoin can be written up to 8 decimals so the smallest amount of bitcoin you can own is 0.00000001 btc.
100 million of these satoshis make up 1 whole bitcoin. So when you’re buying bitcoin, it might look expensive at 50k, 100k or 200k but you can buy as little as you want. If you buy $100 worth of BTC at 50k, you’ll receive 0.0021 btc – no need to worry about buying a whole bitcoin!
The Best Places to Buy a Fraction of a Bitcoin
But in a nutshell, Bitbuy is one of the most reputable exchanges in Canada for investors to buy and sell bitcoin from. The only downside is they have a 1.5% deposit fee – which might be on the high side.
Coinbase’s minimum deposit is $25, meaning you can just buy $25 worth of bitcoin if you want. For a full review of the pros and cons of Coinbase, read our in-depth guide.
Coinbase does not have any deposit fees and they are one of the most trusted exchanges in the world as Coinbase is looking to go public into the stock market.
Binance does not have a minimum deposit but if you want to buy bitcoin on Binance, you need to buy at least $80 worth. For a full review of the pros and cons of Binance, read our in-depth guide.
Binance is the largest cryptocurrency exchange in the world and generally has the lowest fees when buying and selling cryptocurrencies.
Buying Fractions of BTC with Dollar Cost Averaging
“Bitcoin is too high!”
“Is it too late to buy?”
You might catch yourself saying these lines…
Good news is that there is a strategy which can help alleviate trying to time the market.
It’s called Dollar Cost Averaging or DCA for short.
Now this strategy does require you to think about the long term ROI potential of bitcoin. How this works is, let’s say you have $10,000 capital.
You buy $2.5k worth of bitcoin at 50k.
If it starts dropping to 45k, you buy another $2k worth of bitcoin.
If it drops to 40k, you buy another $3k worth of bitcoin.
Now you’ve spent 7.5k out of the 10k to buy bitcoin. Your average buy in price is around 45k. So instead of bitcoin needing to recover from 40k to 50k, your investment is back in profit when bitcoin hits 45k.
If you stopped buying bitcoin after it dropped from 50k, you would need to wait until it’s 50k to be in profit.
This is the power of DCA, as the price drops, you buy more and then when the price recovers, you’re in a much better position.
If you believe in the long term prospects of bitcoin, dollar cost averaging can be a great strategy as you don’t need to stress over market timings.
As the saying goes, “Time in the market beats timing the market”…