What is Redenomination?
Updated
Redenomination is a simplification of the nominal value of a currency by reducing the number of digits (zeros) without diminishing the actual value of the currency.
A redenomination occurs when the value of a token is recalibrated due to a change in the buying power of a currency. For example, on the 21st of August 2020, Polkadot underwent a redenomination of 1 : 100. So, if you had 1 DOT before that date, you then had 100 DOT after. Consequently, the price per DOT is divided by 100 which means the buying power remains the same for DOT hodlers.
Redenomination is an action where the issuer of the tokens changes the name or face value of the token and reissues a new token in a defined ratio.
