Token decimals: what they are and why they matter

Tokens often appear with long strings of numbers after the decimal point. Those places come from the token's decimal setting. The setting tells software how to turn a raw whole number stored on the network into the amount you see, and back again for a send. That is why they matter when you send.

What are token decimals?

A token decimal is the number of places after the decimal point that a token's smallest unit allows. The token contract stores balances as whole numbers. The decimal setting tells wallets and exchanges where to place the decimal point when they show that whole number as an amount.

How do decimals affect transfers?

Wallets and exchanges use decimals to display and send the correct token amount. When you enter an amount, your wallet converts it into the whole number the network expects. If the network or contract is wrong, the same whole number can be read with the wrong decimals, so the displayed amount and the token can go wrong.

Why do tokens use different decimals?

Token creators choose the decimal count when they write the token contract. That choice is part of the contract, and users cannot change it. Tokens on the same network can have different counts because contracts set different values.

Do decimals change token value?

No. Decimals affect divisibility and display, not a token's market value. Two tokens with different decimal counts can have the same price per whole token, because the decimal setting only changes how the amount is split and shown. A long string of decimal places does not make a token more valuable.

Written byVahe HakobyanVahe Hakobyan is the editor-in-chief of World-Crypt. He covers bitcoin, markets and regulation, and leads the newsroom that fact-checks every story before it goes live.