WorksheetsChapter 12 Cryptocurrencies
Total questions: 15
Worksheet time: 10mins
Cryptocurrency is ......
independent digital currency
Decentralized management in processes such as coin issuance, transaction confirmation, data storage etc
Encrypted with cryptography
a coin issuance controlled by the government or central bank in a country
Does a cryptocurrency has value?
No, it has no inherent value
Its value comes from the people's belief in it
Yes, it has inherent value
Its value is determined by the central bank
Which one of the following is NOT correct?
The price of cryptocurrencies is determined by the ratio of demand and supply on the respective exchanges/platforms
Cryptocurrency user can audit all transactions without having to get permission from anyone
Cryptocurrency has no central or regulating authority but the fluctuation of its value is monitored by the central bank
The value of cryptocurrency comes from an encrypted code that is difficult to reproduce, limiting the supply of coins
Cryptocurrency is merely an entry in a database available publicly aka blockchain
Which of the following are the attributes of cryptocurrencies?
Cryptography manages cryptocurrencies by using encryption and decryption techniques
Digital assets that can be used for monetary transactions
No central issuing or regulating authority
Decentralized method used to verify, record and monitor all the transactions
Decentralized method used in coin issuance but limited in number by the governing algorithm
Is cryptocurrency legal?
Illegal
Legal
Legal depends on its usage in a country
How did Bitcoin receive huge popularity as compared to its predecessors?
Satoshi used existing concepts to implement Bitcoin and solved the issues of earlier attempts to create digital money.
Bitcoin became the first successful implementation of a decentralized accounting system compared to its predecessors
Nobody has no idea what Satoshi did and no one knows what is its predecessors
There are many contemporary issues that Bitcoin solved EXCEPT:
Decentralized financial system independent of government and banks
Subject to the inflationary effect
Does not allow freezing, reverting or cancelling transactions
Bitcoin payments can be used anonymously and virtually impossible to censor the transactions
Users who transacted using Bitcoin can automatically demand for a refund if he/she does not like the purchased goods
The occurrence of connection and disconnection of participants dependent upon each other will affect the work of other network members.
No, it will not affect every participant in the network because everyone keeps and updates the database and the corresponding software independently.
Yes, it will affect every participant in the network because everyone keeps and updates the database and the corresponding software independently.
What is the difference between the issuance of Bitcoin and money like fiat currency?
The process of putting printed cash or non-cash money into circulation is controlled by the government
Issuing Bitcoin is decentralized by using mathematical algorithms performed by the users themselves
Issuing Bitcoin is centralized by using mathematical algorithms performed by the users themselves
The price of Bitcoin is determined strictly by the law of supply and demand between buyers and sellers.
It is established on cryptocurrency exchanges which allow people to buy or sell coins using order book
It is different across different exchanges between the demand and supply in different sites created by the users
It is volatile and not always recommended to be used as a payment/settlement tool
It does not allow retail investors/consumers to use it as investment tool or medium of exchange
What are the limitations of Bitcoin?
Limited capacity
High maintenance cost
Short transaction confirmation
Openness of transaction data
High volatility
What is 'altcoin'?
Alternative coin
All the other cryptocurrencies except Bitcoin
Bitcoin forks that are created out of the original bitcoin but new protocols are used to create new blockchain transactions
Which coin
What are the functions of digital/crypto wallets?
Check Balance
Generating addresses and storing user keys
Sending and receiving payments
Withdraw bitcoin as cash
Create wallet backup and restoring wallet from the backup
What is an address of a crypto wallet?
It is used by the sender to identify the recipient of cryptocurrencies
It is used by the recipient to identify the sender of cryptocurrencies
It uses the sender's private key to access the content of the recipient's wallet
How many types of crypto wallets?
1
2
3
4
