Decimals: Why Tokens Use 18 Decimal Places

1// The decimals function — usually returns 18
2function decimals() public pure returns (uint8) {
3    return 18;
4}
5
6// Internally, all amounts are stored in the smallest unit (like wei)
7// 1 token    = 1000000000000000000 (1e18)
8// 0.5 tokens = 500000000000000000  (5e17)
9// 0.01 token = 10000000000000000   (1e16)
10
11// The name(), symbol(), and decimals() form "token metadata"
12function name() public pure returns (string memory) {
13    return "Effort Token";
14}
15
16function symbol() public pure returns (string memory) {
17    return "EFFORT";
18}

1// Converting between human-readable and raw amounts
2import { parseUnits, formatUnits, parseEther, formatEther } from "viem";
3
4// For 18-decimal tokens (most common):
5const rawAmount = parseEther("2.5");
6// Result: 2500000000000000000n (BigInt)
7
8const humanAmount = formatEther(2500000000000000000n);
9// Result: "2.5"
10
11// For tokens with different decimals (e.g., USDC = 6):
12const usdcRaw = parseUnits("100.50", 6);
13// Result: 100500000n
14
15const usdcHuman = formatUnits(100500000n, 6);
16// Result: "100.5"
17
18// DANGER: Using parseEther for USDC would give the wrong amount!
19// parseEther("100") = 100000000000000000000 (way too large for USDC)