Wei Definition in Cryptocurrency How It Works and History

Wei Definition in Cryptocurrency How It Works and History

Wei: Cryptocurrency Definition, Functionality, and History

What Is a Wei?

Wei is the smallest denomination of ether, the cryptocurrency used on the Ethereum network. One ether equals 10^18 wei, making one wei equivalent to one quintillionth of an ether.

Key Takeaways

  • A wei is the smallest unit of ether, similar to how a satoshi is the smallest unit of bitcoin.
  • Unlike the U.S. dollar, which is divisible into 100 pennies, cryptocurrencies like ether are divisible into much smaller units.
  • The wei is named after Wei Dai, known as the creator of the bitcoin predecessor "b-money" and the developer of the Crypto++ library.

How Wei Works

With the exponential growth of cryptocurrency prices, questions arise about how to handle fractions of digital assets like ether. Unlike the U.S. dollar, which can be divided into 100 parts, cryptocurrencies can be divided into much smaller units.

To accurately represent a transaction that may appear as a small fraction in ether but has significant value when converted to real-world currencies like the U.S. dollar, new units have been introduced to facilitate such transactions.

The wei, named after cryptography activist Wei Dai, represents the smallest unit of ether. Wei Dai is known for advocating strong cryptography and privacy-oriented technologies.

Ether has various names for different wei units, reflecting their quantities. For instance, a kwei is equivalent to a thousand wei, and informally, it is called a "babbage," whereas a gwei is commonly referred to as a "shannon."

READ MORE  Market Versus Quote MVQ What It is How It Works
Sub-units of Ether
Unit Wei Value Wei Ether Value
wei 1 wei 1 10^-18 ETH
kwei 10^3 wei 1,000 10^-15 ETH
mwei 10^6 wei 1,000,000 10^-12 ETH
gwei 10^9 wei 1,000,000,000 10^-9 ETH
microether 10^12 wei 1,000,000,000,000 10^-6 ETH
milliether 10^15 wei 1,000,000,000,000,000 10^-3 ETH
ether 10^18 wei 1,000,000,000,000,000,000 1 ETH

The Wei’s Exemplar

Wei Dai, an intensely private individual, possesses exceptional cryptography skills and has carefully managed his public image. While there is limited information available, it is known that he earned a Computer Science degree from the University of Washington and worked in Microsoft’s cryptography research group.

"Mr. Dai worked in the Cryptography Research Group at Microsoft Corporation in Redmond, Washington. While at Microsoft, he was involved in the design, study, and implementation of specialized cryptosystems. Before joining Microsoft, Mr. Dai worked as a programmer at TerraSciences in Acton, Massachusetts."

Wei Dai is an original member of the cypherpunk movement in the 1990s. This group later laid the groundwork for cryptocurrency in the 2010s. Wei’s cryptocurrency manifesto, b-money, introduced the concept of "smart contracts" that can self-execute without human intervention. As a tribute to his groundbreaking ideas, the smallest unit of ether is named after him.

Leave a Reply

Your email address will not be published. Required fields are marked *