3 Questions
What is the main difference between centralization and decentralization?
Decentralization is less sensitive to inflation.
What is the purpose of decentralized cryptoassets?
To be used as an alternative to regulated currency.
What is the primary risk associated with decentralized cryptoassets?
Money laundering-related offenses and fraud
Study Notes
- Centralization and decentralization can be applied to cryptoassets, networks, and exchanges.
- Centralization refers to the extent to which a cryptoasset is issued, operated, managed, and regulated by a central party.
- Decentralization refers to the lack of a single controlling party for a cryptoasset, which can make it less sensitive to inflation and allow it to be used as an alternative to regulated currency.
- Because decentralized cryptoassets lack central oversight, they are more prone to money laundering-related offenses and fraud.
Test your knowledge on centralization and decentralization in the context of cryptoassets, networks, and exchanges. Understand how centralization and decentralization impact the regulation, control, and security of cryptoassets.
Make Your Own Quizzes and Flashcards
Convert your notes into interactive study material.
Get started for free
