Risk Mitigation Flashcards
7 cards from real Blockchain Technology practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Risk Mitigation flashcards as text
Which mitigation reduces the risk that an integer overflow corrupts token accounting?
Answer: Using a compiler version with built-in overflow checks or SafeMath
Overflow-checked arithmetic prevents wraparound bugs that misreport balances.
A DAO wants to mitigate the risk of treasury mismanagement. Which control is most effective?
Answer: Spending caps with multisig approval and on-chain transparency
Caps, multisig, and transparency create accountability and limit unilateral spending.
What risk does enforcing slippage tolerance on swaps primarily mitigate?
Answer: Front-running and sandwich-attack losses
Slippage limits reject trades that move too far from the expected price, blunting sandwich attacks.
Which practice best mitigates the risk of losing access to funds due to a single lost seed phrase?
Answer: Using a multisig or social-recovery scheme across multiple devices/parties
Distributed recovery removes the single point of failure of one seed phrase.
How does monitoring with on-chain alerting mitigate operational risk?
Answer: It enables rapid detection and response to anomalous transactions
Real-time alerts let teams react before an exploit fully drains funds.
Which mitigation addresses the risk of an upgradeable proxy being pointed at a malicious implementation?
Answer: Restricting upgrade rights to a timelocked multisig with public visibility
Timelocked, multisig-controlled, visible upgrades prevent stealthy malicious implementation swaps.
What is the main risk-mitigation purpose of an incident response plan for a protocol?
Answer: It defines roles and steps to contain and recover from an attack quickly
A prepared plan reduces response time and confusion during a live incident.