19 Questions
What is a key advantage of trading in digital currency according to the text?
Global reach
How are transactions in digital currency recorded?
Permanently added to a ledger
What sets cryptocurrencies apart from traditional payments like cash and credit cards according to the text?
Digital and encrypted nature
Why are transaction fees for trading in cryptocurrency appealing compared to traditional financial institutions?
They are much lower
Which feature of digital currency makes it harder to be stolen compared to physical cash?
Decentralized nature
What characteristic of cryptocurrency provides users with direct control over their funds?
Absence of middlemen
Why does the text mention that you cannot be 'ripped off' in a cryptocurrency transaction?
'Digital and encrypted' characteristics
What role does geographical boundaries play in the acceptance and use of cryptocurrency?
Are irrelevant to cryptocurrency use
'You Control Your Money' is highlighted in the text to emphasize what aspect of cryptocurrency?
'Absence of middleman'
What do big crypto-exchanges use to record transactions?
Internal databases that periodically synchronize with the blockchain
What are alternative hashing algorithms compared to in the text?
Various types of locks for securing blockchain information
Which of the following is NOT listed as an alternative hashing algorithm?
SHA-256
What is a potential advantage of alternative consensus models like proof-of-stake over proof-of-work?
Lower latency and less computational power required
What type of wallets focus only on the most recent or unspent outputs, similar to credit card transactions?
Thin wallets
What is the term used in the text to describe the ability of blockchains to communicate with other blockchains?
Blockchain interoperability
What are sidechains described as in the text?
Independent blockchains that connect to their parent chains via a two-way bridge
What is the purpose of posting bond on blockchains like Tendermint, according to the text?
To make it costly to fork and potentially improve operability and security
Which of the following is NOT mentioned in the text as a type of dark pool?
Peer-to-Peer Dark Pool
What is the purpose of dark pools, as described in the text?
To operate internal databases of transactions that periodically synchronize with the blockchain
Prepare for your AIS ELEC 1 midterm exam with this reviewer focusing on chapters 2 and 3. Learn about how blockchain and cryptocurrencies work together, the history of blockchain, differences between bitcoin and blockchain, and more.
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