C4 Professional Ethics & Standards 3

Question 1

A C4 professional posts bullish price predictions for a token on social media without disclosing they were paid to do so. This violates which ethical principle?

Accepted Answer

Transparency and disclosure

Answer

Paid promotions must be disclosed; failure to do so violates transparency principles and potentially SEC/FTC regulations.

Question 2

What is the C4 professional's obligation when they discover a material error in a client report that has already been delivered?

Accepted Answer

Promptly notify the client and issue a corrected report

Answer

Prompt correction and notification of material errors is required to maintain professional integrity and client trust.

Question 3

Under ethical standards for crypto professionals, 'suitability' primarily means:

Accepted Answer

Ensuring recommendations align with the client's risk tolerance, goals, and financial situation

Answer

Suitability requires that any recommendation be appropriate for the specific client's individual circumstances, not just the professional's opinion.

Question 4

A crypto exchange employee learns about an upcoming large institutional buy order before it is executed. Trading on this information personally would constitute:

Accepted Answer

Front-running, which is an ethical and legal violation

Answer

Front-running — trading ahead of known client orders for personal gain — is market manipulation and a serious fiduciary breach.

Question 5

Which C4 ethical principle requires professionals to maintain and improve their knowledge of cryptocurrency markets and regulations?

Accepted Answer

Competence through continuing education

Answer

The principle of competence obligates certified professionals to maintain current knowledge through ongoing education given the rapidly evolving crypto landscape.

(C4) CryptoCurrency Certification Consortium Practice Test

(C4) CryptoCurrency Certification Consortium Practice Test

C4 Professional Ethics & Standards 3