1

I know that Solidity doesn't use decimals, but I'm having a hard time wrapping my head around 18 zeros in Wei in calculating compound interest. How do you do it? I have found no examples.

I first tried this:

contract CompoundInterest {

uint public Periods = 30;
uint public Principle = 10000;
uint public Interest;
uint public InterestRateInteger = 2;

 function CalculatedInterest() public {

 Interest = Principle * (1 + InterestRateInteger/100)**Periods;

 }

This example is just the classic compound interest formula. I tried this as well, and got a result that was correct, but I couldn't figure out how to refactor for Wei.

 function CalculatedInterest() public {

 Interest = Principle * (100 + InterestRateInteger)**Periods;

 }

The idea is that interest only compounds years, so 102 would be equal to 1.02.

0

Using a for loop works, but I'm not sure if this is optimal:

 for (i=0;i<Periods;i++) {
          Principle += Principle* InterestRateInteger/100;

 }
-2

See this answer for a much faster solution, independent of the number of periods: Is there any efficient way to compute the exponentiation of a fraction and an integer? Copied from the answer:

The following is a decent, low-cost approximation:

// Computes `k * (1+1/q) ^ N`, with precision `p`. The higher
// the precision, the higher the gas cost. It should be
// something around the log of `n`. When `p == n`, the
// precision is absolute (sans possible integer overflows). <edit: NOT true, see comments>
// Much smaller values are sufficient to get a great approximation.
function fracExp(uint k, uint q, uint n, uint p) returns (uint) {
  uint s = 0;
  uint N = 1;
  uint B = 1;
  for (uint i = 0; i < p; ++i){
    s += k * N / B / (q**i);
    N  = N * (n-i);
    B  = B * (i+1);
  }
  return s;
}

This function computes k * (1+1/q) ^ N. So, for example, to compute 2500 * 1.01 ^ 137, we could use fracExp(2500, 100, 137, 8). This outputs 9769, which is very close to the real value, 9771.657061221898.

Your Answer

By clicking “Post Your Answer”, you agree to our terms of service, privacy policy and cookie policy

Not the answer you're looking for? Browse other questions tagged or ask your own question.