As someone who follows tech and gaming closely, I‘m fascinated by the history behind the terms we use. Lately I‘ve been curious – why do Americans say "two bits" when referring lightheartedly to a quarter dollar? Where did this odd slang come from?
In exploring this linguistic curiosity, I discovered the key lies in early Spanish coins that were quite literally cut into "bits". Let‘s take a fun dive into the history of "two bits", and learn why this relic of slang is still bits of fun to use today.
The Rise and Influence of the Spanish Dollar in Colonial America
To understand the roots of "two bits", we need to go back to the dominance of the Spanish dollar in the New World colonies.
Also known as the peso or the "piece of eight", the Spanish dollar was a silver coin about the size of an American half dollar. It was initially minted in Spain from plundered New World silver as far back as the late 1500s.
The coin gained a foothold through Spanish trade and conquest throughout the Americas. Eventually it became a de facto global currency, used in the British colonies of North America, the Caribbean, and even in China.
According to the financial history book Crucible of Power, the Spanish dollar "greased the wheels of commerce" and was the most common coin seen in colonial America prior to the American Revolution.
What made the coin unique was its division into eight wedge-shaped segments for easy paring.
Cutting Up the Pie – Bits and Reals of the Spanish Dollar
You‘re probably wondering…why was the Spanish dollar segmented like a pizza?
This was rooted in the coin‘s intrinsic silver value. The Spanish dollar contained approximately 3⁄4 ounce of .930 fine silver. This amount of pure silver was worth eight reales based on Spanish currency standards.
Each 1/8 section of the coin represented one real – what we‘d now call 12.5 cents.
As foreign coins flooded the colonies, it became common to cut and "break" them into smaller pieces or "cut money" to make change. Sharp-eyed merchants would actually weigh coins to confirm their silver content before accepting them!
So the Spanish dollar, thanks to its pie-shaped segments, could literally be cut into eight "bits" or reales as needed.
The Rise of "Bit" as Slang for Money
As you can imagine, the idea of breaking off "bits" of coinage led to the word bit becoming popular American slang for money.
By the early 1800s, folks referred to low-value coins or change as "bits". For example, you might say:
"I‘m a bit short on bits at the moment, my friend."
This slang usage spread through speech, newspapers, and even song lyrics. There are many recorded instances of early Americans asking each other for "bits" to make purchases.
According to etymologist Peter Jensen-Haxel, the first written example of bit meaning money comes from a 1768 letter by merchant Joseph Clarke:
“I was jokin and did not Expect he would give me a bit”
So as you can see, by the late 1700s, "bit" was firmly fixed in the American vernacular.
This now brings us to two bits specifically meaning a quarter dollar. Let‘s connect the dots…
Linking "Two Bits" and the Quarter
Based on the Spanish dollar being worth eight bits or reales, early Americans called:
- 1 bit = 12.5 cents
- 2 bits = 25 cents (a quarter dollar)
- 4 bits = 50 cents (a half dollar)
So "two bits" became shorthand for a quarter, the handiest 25 cent piece.
Some examples of "two bits" in early American writings:
"Oh yes! I will certainly take two bits worth." – John Pendleton Kennedy, Horse-Shoe Robinson, 1835
"When I smaller was than thumb, Miss Dolly keepet school: She‘d lie and giggle…And I would cry,–Boo hoo!–And she‘d reply, "Now, little boys, make less noise, or I‘ll dismiss you both, you two bits of boys." – Junius Henri Browne, The Great Metropolis, 1869
So by the 1800s, everyone knew if you needed a quarter, you could ask your buddy for "two bits".
This usage continued into the early 20th century, though it gradually faded as "quarter" became more common. But even today, you‘ll hear the occasional "two bits" in place of a quarter for fun. Try it on a cashier!
From Pieces of Eight to Paper Dollars
Now you‘re probably wondering – as the US moved to minting its own coins and printing paper money, what happened to the Spanish dollar and the whole "bits" system?
It‘s quite fascinating. In 1786, the US federal government began minting its own coins, including the quarter, half dollar and silver dollar.
However, Spanish coins remained legal tender in the United States until the Coinage Act of 1857. Up through the mid 1800s, you‘d see American coins circulating side-by-side with Spanish reals and pistareens.
The US also started printing paper money dollars in the 1860s. Gradually this replaced the use of foreign coins.
But the old names – one bit for 12 1⁄2 cents, two bits for a quarter, and so on – stuck around for decades in popular slang, even if the coins that inspired them fell out of use.
Fun fact: When US coins were decimalized into 100 cents in the 1790s, it did cause some confusion over the value of a "bit". Suddenly a bit was not 1/8 of a dollar…math don‘t lie! But the traditional slang meanings persisted anyway.
The Curious Case of the Picayune
Spelling out the early roots of American money slang leads to some fascinating detours. Allow me one quick side note on the "picayune".
The picayune was a Spanish coin called the "medio" worth one-sixteenth of a dollar, or about 6 1⁄4 cents. It circulated widely in the New Orleans area.
By the 1800s, picayune also became Louisiana slang for a small monetary unit or coin of little value, similar to bit.
Amusingly, a popular New Orleans newspaper first published in 1837 was named the Daily Picayune after this slang term. Learn something new every day!
On the Evolution of Bits and Bytes
Now that we‘ve thoroughly unpacked the story of two bits and the Spanish dollar, you may be wondering – what about the use of "bits" today in computing? How does that connect to historical money slang?
The computing sense of bit for a binary digit (either 0 or 1) did arise directly from the "small unit" meaning of bit. In the 1940s, scientist John Tukey coined "bit" as short for "binary digit".
But connecting bits to bytes takes us back once again the Spanish dollar and its eight bits!
Why? Because a byte is comprised of eight bits. And eight bits would be the same portion of data as one piece of eight from those old Spanish coins.
Those early "bits" of coinage were dividing up dollars into eights. Modern computer bits divide bytes into eights. The etymology directly parallels!
So the next time you measure digital storage in megabytes or gigabytes, remember it traces back to the peso and reales.
From Pirate Treasure to Virtual Bits
Today, bits have gone fully digital with Twitch‘s popular "Cheering" feature. Fans can purchase packs of Bits and then cheer them in chat to support streamers.
Each Bit is worth 1 US cent that goes to the streamer. So cheer 100 Bits, and the streamer gets $1. 1000 Bits nets them $10.
It‘s a way to tip streamers without transaction fees, and bits have grown into their own virtual economy. Fans vie to be the top Bit leader in different channels.
Streamers in turn offer loyalty perks and bonuses for big Bits cheers. You‘ll see colorful animations and events when Bits come raining down in chat.
In 2022 alone, over $100 million was paid out to streamers through Bits cheering. So these virtual coins are generating real income through the kindness of fans.
Bits may not come in a leather pouch like old Spanish doubloons, but they let Twitch viewers feel like patrons showering contemporary pirates (streamers) with treasure.
It‘s a modern spin, but still tied to that magical feeling of slinging coins at your favorite performer and yelling “Two bits!”
In Conclusion, Two Bits Is…
As we’ve discovered on this linguistic adventure, two bits as slang for a quarter dollar has its roots in the history of American money and trade.
The Spanish dollar, cut into eight bits or reals, led “two bits” to be shorthand for the handy amount of 25 cents.
Understanding this context lets us appreciate why we sometimes still say “two bits” affectionately when referring to a quarter. This relic of slang carries with it centuries of monetary history.
We even touched on how the legacy of the word “bit” lives on in modern computing, where eight bits make a byte. And fans can now cheer virtual Bits to support streamers on Twitch.
So despite inflation, the intrinsic value of “two bits” as Americana remains timeless. Whether you’re parsing pesos or mining crypto, bits still count as more than just spare change.
What will be the next evolution of this versatile little unit? The bits are still flipping, so stay tuned!
