arbitrary precision in compound interest state

Agoric · Feb 16, 2022 · 7c3bff8 · 7c3bff8
1 parent 8851848
commit 7c3bff8
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Showing 2 changed files with 18 additions and 9 deletions.
diff --git a/packages/run-protocol/src/vaultFactory/interest.js b/packages/run-protocol/src/vaultFactory/interest.js
@@ -3,17 +3,16 @@
 import '@agoric/zoe/exported.js';
 import '@agoric/zoe/src/contracts/callSpread/types.js';
 import { natSafeMath } from '@agoric/zoe/src/contractSupport/index.js';
-import {
-  makeRatio,
-  multiplyRatios,
-} from '@agoric/zoe/src/contractSupport/ratio.js';
+import { makeRatio } from '@agoric/zoe/src/contractSupport/ratio.js';
 import './types.js';
 
 export const SECONDS_PER_YEAR = 60n * 60n * 24n * 365n;
 const BASIS_POINTS = 10000;
 // single digit APR is less than a basis point per day.
 const LARGE_DENOMINATOR = BASIS_POINTS * BASIS_POINTS;
 
+const COMPOUNDED_INTEREST_PRECISION = 10n ** 30n; // to 30 decimal places
+
 /**
  * @param {Ratio} annualRate
  * @param {RelativeTime} chargingPeriod
@@ -102,8 +101,17 @@ export const calculateCompoundedInterest = (
   if (priorDebt === 0n) {
     throw new Error('No interest on zero debt');
   }
-  return multiplyRatios(
-    priorCompoundedInterest,
-    makeRatio(newDebt, brand, priorDebt, brand),
-  );
+  let numerator = newDebt * priorCompoundedInterest.numerator.value;
+  let denominator = priorDebt * priorCompoundedInterest.denominator.value;
+
+  // scale down to avoid runaway growth of repeated multiplication
+  while (
+    numerator > COMPOUNDED_INTEREST_PRECISION &&
+    denominator > COMPOUNDED_INTEREST_PRECISION
+  ) {
+    numerator /= COMPOUNDED_INTEREST_PRECISION;
+    denominator /= COMPOUNDED_INTEREST_PRECISION;
+  }
+
+  return makeRatio(numerator, brand, denominator, brand);
 };
diff --git a/packages/run-protocol/test/vaultFactory/test-interest.js b/packages/run-protocol/test/vaultFactory/test-interest.js
@@ -423,6 +423,7 @@ test('calculateCompoundedInterest on zero debt', t => {
 });
 
 // -illions
+const M = 1_000_000n;
 const B = 1_000_000_000n;
 const Q = B * B;
 
@@ -434,7 +435,7 @@ test('calculateCompoundedInterest', t => {
     [11n, 10n, 1n, 2n * Q, 22n * Q, 10n], // >1 previous interest
     [1n, 1n, 1n, 2n * Q, 2n * Q, 1n], // ludicrous rate greater than Number.MAX_SAFE_INTEGER
     [2n, 1n, 1n * Q, 2n * Q, 4n * Q, 1n * Q], // 2x on huge debt
-    [4n * Q, 1n * Q, 4n * Q, 8n * Q, 32n * Q * Q, 4n * Q * Q], // 2x again
+    [4n * Q, 1n * Q, 4n * Q, 8n * Q, 32n * M, 4n * M], // 2x again, ratio reduced
   ];
   for (const [priorNum, priorDen, oldDebt, newDebt, newNum, newDen] of cases) {
     const oldInterest = makeRatio(priorNum, brand, priorDen, brand);