Lecture 1: An Introduction to Cryptocurrency

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What is the double-spending problem? *

1 point

Picking one out of multiple pending transactions to confirm.

Assuming two or more transactions are trying to spend the same coin, only one transaction can be finalised.

Select one or more key insights by Satoshi Nakamoto to solve the problem which plagued all previous e-cash protocols? *

2 points

Replacing human trust with programmable rules.

Incorporating the US legal system in the block production process.

Allowing anyone to participate as a broker.

Relying solely on altruistic behaviour of participants

Required

What is a Bitcoin address or Ethereum account? *

1 point

A cryptographic hash of the public key such that A = H(P).

An encryption of the public key.

What is trust engineering? *

1 point

Setting up a trusted party to protect the system

Defining and reducing trust in the system

What is a block producer not trusted to enforce in a cryptocurrency like Bitcoin or Ethereum?

5 points

Monetary policy

Rules that dictate validity of a transaction

An approve list of who can participate

Not to reverse already confirmed transactions

Deciding the order of execution for a list of transactions

Picking the next leader for producing blocks

What does an attacker need to forge a signature from your public key?

1 point

Private key

Previous digital signatures

Address/account

Screenshot of your metamask wallet

Clear selection

Who pays for a transaction? *

1 point

User

Node

Block producer

No fee

Is a block producer also a node on the network? *

1 point

Yes

What is a block? *

1 point

An unordered list of transactions

An ordered list of transactions

A full copy of the database at a given time

Does proof of work help scale transactions on the network? *

1 point

Yes

Why do we need a leader election?

2 points

Satoshi appointed a large set of participants in advance and we need to pick amongst them just in case some go offline.

There is no trusted authority who can pick a leader to run the system.

Protect liveness of the system as anyone can participate.

Democratic elections are a way to secure the system.

By knowing the leaders, we can rapidly scale transaction throughput.

What properties can we find in proof of work? *

3 points

Popular on TV

Time consuming to solve

Time consuming to verify solution

Only one solution for the same challenge

Quick to solve

Quick to verify solution

Multiple solutions to same challenge

Puzzle is subjective

Puzzle is set by a leader

Required

What is a fork in the chain's tip? *

1 point

Competing blocks at the tip of the blockchain

A special reward to the block producer

Why do we need a fork choice rule? *

1 point

It is not needed. Block producers can just extend all competing blocks.

To decide which chain of blocks should be considered part of the blockchain.

Can a transaction get dropped (reversed) after it is confirmed?

1 point

Yes

Clear selection

What is the recommended number of confirmations to wait for a Bitcoin transaction? *

1 point

How are new coins issued on a network like Bitcoin or Ethereum?

1 point

All coins existed and allocated when the network was formed.

Every new block issues new coins to the block producer.

Every new block issues new coins to all users of the network.

Clear selection

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