I’m also having some trouble understanding how to calculate rate. The target decimals is 5 not 18, and I want the initial rate to be $.01 per token. I’m not sure how to calculate this for my rate variable for the crowdsale

# How to calculate rate for a crowdsale?

Hi @Roodiger

The Crowdsale documentation gives an example of how to calculate the rate:

https://docs.openzeppelin.com/contracts/2.x/crowdsales#crowdsale-rate

Using this example for decimals of 5 and an initial rate of $0.01 per whole token:

If you want to issue “1 TKN for every 0.01 dollar (USD) in Ether”, we would calculate it as follows:

- assume 1 ETH == $200
- therefore, 10^18 wei = $200 or (20,000 cents)
- therefore, 0.01 USD is
`10^18 / 20000`

, or`5 * 10^13 wei`

- we have a decimals of 5, so we’ll use
`10^5 TKNbits`

instead of`1 TKN`

- therefore, if the participant sends the crowdsale
`5 * 10^13 wei`

we should give them`10^5 TKNbits`

- therefore the rate is
`5 * 10^13 wei === 10^5 TKNbits`

, or`1 wei = 2*10^9 TKNbits`

- therefore, our rate is
`2*10^-9`

Testing this out:

- If a participant paid 0.01 USD they should get
`1 TKN`

or`10^5 TKNbits`

- 0.01 USD is
`5 * 10^13 wei`

- Using the rate of
`2*10^-9`

`(5 * 10^13) * (2*10^-9) = 10^5 TKNbits or 1 TKN`

1 Like

Hi @Roodiger Did the explanation of rate calculation make sense?

If it answered your question can you mark my reply as the solution. Thanks