What's a "bit"?

"The word “bit” long meant, in England, any coin of a low denomination. In early America, “bit” was used for some Spanish and Mexican coins that circulated and were worth one-eighth of a peso, or about 12 and one-half cents. Hence, two bits would have equaled about 25 cents." - The Old Farmer's Almanac

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"Most communities differentiated between one-bit and two-bit saloons. Really sleazy places would charge just a nickel for a beer, a whiskey, or a cigar, but they were relatively rare. Most saloons were one-bit places (with a range of quality in establishments charging these prices). Communities could only support a few two-bit saloons because the price - twice as much as most saloon- meant that these establishments were exclusively for those who didn't want to rub elbows with the average customer." - Reddit