Value Granularity

Penny Candies

A concise explanation of the penny-candy issue, why it appears in monetary systems, and how PILLAR avoids it by making shares the canonical unit.

What the term means here

In this protocol, penny candy is a precision risk under inflation or deflation. If inflation occurs, a dollar of real purchasing value can come to cost more than one displayed Dollar label, so a Penny-candy purchase can no longer be bought for one Penny. If deflation occurs, the opposite happens: a Penny label may overstate how much real value is represented and a unit of money can settle into multiple Penny-candy units. In both cases, tiny labels look stable while the unit of account behind them drifts.

Why this can be a real problem

This matters most at the retail edge. People care about whether a “one Penny” purchase still means the same outcome over time. If inflation or deflation shifts the real value behind labels, systems can hide mismatch through rounding, queue timing, or stale UX rounding behavior. Users see stable small-number pricing but are actually transacting against a different settlement amount.

How PILLAR solves it

PILLAR treats shares as the canonical unit and keeps labels like Dollar and penny as fixed aliases.

Since shares are fixed and the total share supply is fixed, these labels are anchors by design. A “Penny” does not change its own alias size; if inflation changes purchasing power, the system is still measured in fixed shares, and if deflation makes spending split across units, the fixed share mapping remains explicit.

`PENNY_SHARES = 10` shares and `DOLLAR_SHARES = 1,000` shares are fixed constants.
Granularity is controlled by `MIN_SHARES = 1`, so the base unit can represent the smallest ledger movement.
Genesis conversion and all fee/fee-related calculations use deterministic rounding rules.
Redemption burns shares from supply and does not introduce discretionary label re-basing.

What this means for users

1) Display clarity

User-facing labels stay easy to read, while protocol accounting remains strict and auditable in shares. This preserves familiarity without obscuring mechanics.

2) Deterministic pricing

Small amounts resolve through fixed-share math instead of ad hoc policy overrides. You can reproduce each conversion from constants and formulas.

3) Better risk controls

Rounding and cap constraints make tiny amounts less likely to create hidden drift. If a difference appears, it is explicit in the math rather than buried in UX labels.

Where this is documented already

This issue is already covered in PILLAR documentation: the Whitepaper section on value precision and the technical reference label-precision rules. The same constraints appear through fixed constants (`DOLLAR_SHARES`, `PENNY_SHARES`, `SHARE_SUPPLY_MAX`) and `MIN_SHARES` rules.