Understanding Bitcoin and Blockchain

What is the primary factor that determines the value of Bitcoin?

• Supply and demand

• Number of transactions

• Government regulations

• Mining difficulty

How are new Bitcoins created?

• Through government issuance

• By solving complex mathematical problems

• By purchasing them from exchanges

• Through peer-to-peer transactions

What is a blockchain?

• A government-regulated ledger

• A digital chain of blocks containing information

• A type of cryptocurrency

• A centralized database

What ensures the security and immutability of blockchain transactions?

• Centralized control

• Manual verification by users

• Government oversight

• Decentralized network of computers

What is the maximum number of Bitcoins that can ever exist?

• 10 million

• 21 million

• 50 million

• 100 million

What is the process called when the reward for mining Bitcoin is reduced by half?

• Halving

• Quartering

• Splitting

• Doubling

Why might Bitcoin mining become less profitable over time?

• Increased government regulations

• Decreased transaction fees

• Reduction in mining rewards

• Increased number of miners

What happens to Bitcoin miners' rewards after all 21 million Bitcoins are mined?

• They stop receiving any rewards

• They receive transaction fees

• They receive newly created Bitcoins

• They receive government subsidies

What is a potential risk of not reporting cryptocurrency earnings to the IRS?

• Inability to trade Bitcoin

• Increased mining difficulty

• Being audited by the IRS

• Loss of Bitcoin value

What service does Legible provide for cryptocurrency users?

• Bitcoin mining services

• Cryptocurrency trading platform

• Blockchain development tools

• Crypto tax solution