XBT is an abbreviation for Bitcoin.
Historically, Bitcoin has been represented on exchanges by the abbreviation BTC. The main difference between XBT and BTC is that the former has been prescribed by ISO, the International Organisation for Standardisation.
ISO prescribes the official three-letter codes that represent specific currencies and other assets. These are published in standard ISO 4217.
The vast majority of codes follow the same format.
For currencies, the first two letters are the official ISO country code, and the last letter is the first letter of the currency’s name. So, in USD, for example, US stands for United States and D stands for Dollar. Similarly. in GBP, GB stands for Great Britain and P stands for Pound Sterling.
When it comes to assets that aren’t connected to a country, and commodities such as gold and silver, ISO uses the letter X. In the case of gold and silver, X is followed by the official symbol for their chemical element. So the symbol for gold, for instance, is XAU — X followed by AU, which is the chemical symbol for gold.
Bitcoin, of course, isn’t a chemical. So ISO followed the letter X with the first two letters of the currency: BT.
While most currency codes follow the same format, there are exceptions. The ISO code for the Euro, for instance, is EUR not EUE, because EUR rolls off the tongue more easily.
Similarly, the code for the Russian Rouble is RUB, not RUR. This is because the current Russian Rouble has replaced the old Russian currency, which was also called the Rouble. ISO gave the new Rouble a new code to avoid confusion.
There’s more to an ISO-certified currency code than just the name. When ISO adopts a currency code, it enters the official database that clearing networks like SWIFT, Visa, and MasterCard rely on. This means Bitcoin is now a selectable clearing and settlement unit for any business that wants to accept it as a payment method.
Even if ISO didn’t have an official standard format for assets that aren’t tied to a country, Bitcoin wouldn’t have been able to keep the code BTC. This is because BT is the official country code for the Kingdom of Bhutan. The code for the Bhutanese currency, called the Ngultrum, is BTN.
Want to know more?
Go here for a comprehensive explanation of the ISO 4217 standard and how it works.
The abbreviation XBT has been in unofficial use for several years. But in this article from 2014, the Bitcoin Foundation’s Jon Matonis argues that obtaining official recognition from ISO would be a crucial step towards mainstream adoption of Bitcoin.
The METACO view
“Having a standard ISO code can only be a good thing for Bitcoin. It gives it legitimacy and reflects its status as an increasingly popular alternative to traditional currencies.“