What is the primary function of blockchain technology?
a) To manage cryptocurrencies only
b) To provide a secure and transparent way to record transactions
c) To mine new coins
d) To monitor stock market prices
What does the term “cryptocurrency” refer to?
a) A digital form of traditional money issued by a central bank
b) A decentralized digital asset based on blockchain technology
c) A physical coin used for online transactions
d) A form of digital data storage
Which of the following is the most widely known cryptocurrency?
a) Litecoin
b) Bitcoin
c) Ethereum
d) Ripple
What does “mining” refer to in the context of cryptocurrencies?
a) The process of creating digital wallets
b) The process of verifying transactions and adding them to the blockchain
c) The process of buying and selling cryptocurrencies
d) The process of creating new cryptocurrencies through an Initial Coin Offering (ICO)
What is the purpose of a “smart contract” in blockchain technology?
a) To store large amounts of data
b) To facilitate and enforce the performance of a contract automatically without intermediaries
c) To create new cryptocurrencies
d) To store passwords securely
Which of the following is a feature of a decentralized cryptocurrency like Bitcoin?
a) It is controlled by a single central authority
b) It operates on a peer-to-peer network without intermediaries
c) It is issued by government-backed institutions
d) It is stored in a central database
What does the term “block” refer to in a blockchain?
a) A temporary storage area for cryptocurrency coins
b) A unit of transaction data that is added to the blockchain
c) A hardware device used to mine cryptocurrencies
d) A digital wallet address
What is the function of a cryptocurrency wallet?
a) To store physical cash securely
b) To generate new cryptocurrencies
c) To store and manage private keys and cryptocurrency assets
d) To verify transactions on the blockchain
Which of the following blockchain platforms is known for enabling smart contracts?
a) Bitcoin
b) Ethereum
c) Litecoin
d) Ripple
What is a “public key” in cryptocurrency transactions?
a) A private code used to access a digital wallet
b) A unique identifier for a cryptocurrency user’s wallet address
c) A password for blockchain miners
d) A secret encryption used to verify transactions
How does the concept of “decentralization” benefit cryptocurrency networks?
a) It allows the network to be controlled by a single entity
b) It enables transparent and secure transactions without relying on intermediaries
c) It makes cryptocurrencies easier to regulate
d) It limits access to the network
What is the main advantage of using blockchain technology in supply chain management?
a) It ensures anonymity of participants
b) It creates permanent records that are transparent and cannot be altered
c) It reduces the speed of transactions
d) It reduces the cost of mining cryptocurrencies
Which of the following is an example of a “proof-of-work” consensus algorithm?
a) Bitcoin
b) Litecoin
c) Ripple
d) Ethereum (prior to Ethereum 2.0)
What is the purpose of a “hash function” in blockchain technology?
a) To create a block of cryptocurrency coins
b) To encrypt transactions and secure the integrity of the blockchain
c) To verify smart contracts
d) To generate new cryptocurrency coins
Which cryptocurrency was the first to use blockchain technology?
a) Ethereum
b) Bitcoin
c) Litecoin
d) Ripple
What does “initial coin offering” (ICO) refer to?
a) A method for mining cryptocurrencies
b) A process for creating new cryptocurrencies and raising capital for a project
c) A process of validating cryptocurrency transactions
d) A type of cryptocurrency wallet
What is the main disadvantage of cryptocurrency as a form of payment?
a) It is not widely accepted for payments
b) It is only used for illegal transactions
c) It is not transparent
d) It is controlled by central banks
How is the supply of Bitcoin limited?
a) Through a fixed number of coins that will ever be mined (21 million)
b) By the demand for Bitcoin in the market
c) By the governments of the world
d) Through inflationary mechanisms in the protocol
Which of the following is an example of a “proof-of-stake” consensus algorithm?
a) Bitcoin
b) Ethereum (after Ethereum 2.0)
c) Litecoin
d) Dogecoin
What is the process of “staking” in cryptocurrency networks that use proof-of-stake?
a) The process of verifying transactions through computational work
b) The process of holding cryptocurrency in a wallet to support network security and earn rewards
c) The process of creating new coins by solving mathematical problems
d) The process of buying and selling coins on exchanges
What is the role of a “block explorer” in blockchain technology?
a) To mine new coins
b) To track transactions and blocks on the blockchain
c) To create smart contracts
d) To create new cryptocurrency wallets
Which of the following is a risk associated with cryptocurrency investments?
a) Cryptocurrency values are completely stable and predictable
b) Loss of funds due to market volatility, hacking, or mismanagement
c) Cryptocurrencies are immune to fraud
d) Centralized control over transactions
Which of the following is true about the transaction fees in a blockchain network?
a) Blockchain transactions are always free of charge
b) Transaction fees depend on network congestion and the amount of data being transferred
c) Transaction fees are set by central authorities
d) Transaction fees are irrelevant to the blockchain process
What is the role of a “node” in a blockchain network?
a) To store cryptocurrency assets
b) To process and validate transactions, ensuring the integrity of the blockchain
c) To create new cryptocurrencies
d) To provide wallets for cryptocurrency storage
Which of the following best describes a “hard fork” in a cryptocurrency blockchain?
a) A change to the blockchain protocol that is backward-compatible
b) A split in the blockchain network that results in two separate versions
c) A method of increasing mining difficulty
d) A process for securing digital wallets
What is a major advantage of blockchain over traditional financial systems?
a) Blockchain systems require no verification of transactions
b) Blockchain offers faster transaction speeds without intermediaries
c) Blockchain is fully regulated by governments
d) Blockchain is a centralized system controlled by banks
Which cryptocurrency uses the “Ripple Protocol” to facilitate faster transactions?
a) Bitcoin
b) Ethereum
c) Ripple (XRP)
d) Litecoin
What does “tokenization” mean in the context of blockchain and cryptocurrencies?
a) The process of creating new blocks
b) The process of converting real-world assets into digital tokens on a blockchain
c) The process of verifying transactions
d) The creation of new cryptocurrencies
What is the purpose of “cold storage” in cryptocurrency security?
a) To store cryptocurrencies on exchanges
b) To store cryptocurrencies offline to protect them from hacking
c) To keep private keys in a digital wallet
d) To increase transaction speeds
What is the role of a “hash rate” in cryptocurrency mining?
a) To measure the amount of energy used in the mining process
b) To measure the speed at which a miner can solve cryptographic problems and create new blocks
c) To track the value of cryptocurrency coins
d) To monitor the number of users on the network
