(now, US) A unit of currency or coin in the Americas worth a fraction of a Spanish dollar; now specifically, an eighth of a US dollar.
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A quarter is two bits.
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I trusted to the Lord to be with me; and at one of our trips to St. Eustatia, a Dutch island, I bought a glass tumbler with my half bit, and when I came to Montserrat I sold it for a bit, or sixpence.
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1789, Olaudah Equiano, chapter 6, in The Interesting Narrative, volume I:
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He left after shaking her down for four bits for carrying the bags.
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1966, Thomas Pynchon, The Crying of Lot 49, New York: Bantam Books, published 1976, →ISBN, page 16: