How did Bill become a nickname for William?

Answer 1

Nicknames are typically a shortened form of the full name; however, names that begin with a vowel or semi-vowel often have a consonant substituted for the first letter, rendering the nickname easier to pronounce. The "W" in "William" is a semi-vowel; the shortened form, "Will" still (obviously) begins with a semi-vowel; the "W" is replaced by a consonant, "B", to make it easier to say.

Here's my say:

Since the modern-day English language came from the German language, it may be that William, when pronounced in German is "Villiam". So, if the nickname for "Villiam" is "Vill", then it follows that "Vill" transformed to the easier-to-pronounce "Bill" when it reached the English-speaking countries.