CBP Cheat Sheet 2026

The 30 highest-yield CBP facts, distilled from real exam questions. Print it, save it as a PDF, or study it here — free, no sign-up.

1. When a user restores a Bitcoin wallet using a 12-word mnemonic seed phrase, what is being recovered? → The master private key, from which all other keys and addresses are derived.
2. Which of the following is a key difference between a hot wallet and a cold wallet? → Hot wallets are internet-connected, while cold wallets are offline
3. What is a UTXO in Bitcoin? → Unspent Transaction Output
4. What is the role of Bitcoin Core in the Bitcoin ecosystem? → The reference implementation of the Bitcoin protocol maintained by open-source developers
5. What does SegWit (Segregated Witness) separate from Bitcoin transactions? → The witness data (signatures) from the transaction data
6. What role do private keys play in Bitcoin transactions? → To sign transactions and prove ownership of Bitcoin
7. Which of the following represents the first confirmation of a Bitcoin transaction? → When the transaction is included in a valid block that is added to the blockchain.
8. What use case does the Lightning Network enable that is impractical on-chain? → Micropayments of fractions of a cent
9. Why is Bitcoin address reuse harmful to privacy? → It links multiple transactions to the same entity, enabling transaction graph analysis
10. What is required to open a Lightning Network payment channel? → An on-chain Bitcoin transaction to fund the channel
11. What routing privacy protocol does the Lightning Network use? → Onion routing similar to Tor
12. What is a 'submarine swap' in the Lightning Network? → An atomic swap between on-chain Bitcoin and Lightning Network Bitcoin
13. What is a 'keysend' payment in Lightning? → A spontaneous Lightning payment without a pre-generated invoice
14. What does the term 'block subsidy' refer to in Bitcoin? → The newly created Bitcoin awarded to miners per block, separate from transaction fees
15. What is a 'watchtower' in the context of the Lightning Network? → A third-party service monitoring channels for fraudulent closing attempts
16. Which characteristic of a cryptographic hash function is most critical for ensuring the immutability of the Bitcoin blockchain? → Pre-image resistance
17. Which of the following is a characteristic of a non-deterministic wallet? → It is often referred to as a 'Just a Bunch Of Keys' (JBOK) wallet.
18. Which U.S. regulatory agency primarily oversees Bitcoin-related financial activities? → Financial Crimes Enforcement Network (FinCEN)
19. What Lightning improvement allows a single payment to be split across multiple routes? → AMP (Atomic Multi-Path Payments)
20. Why is Bitcoin considered a hedge against inflation? → Because it has a fixed supply and cannot be inflated
21. What is MAST (Merklized Abstract Syntax Tree) in Bitcoin? → A way to commit to multiple script conditions while only revealing the executed branch
22. How does the Lightning Network relate to Bitcoin's base layer security? → Lightning inherits Bitcoin's base layer security since channels are settled on-chain
23. How does Bitcoin achieve decentralization? → By using a peer-to-peer network of nodes
24. The historical progression from barter to commodity money, such as shells or salt, was primarily a solution to which problem? → The double coincidence of wants
25. How does Bitcoin affect traditional banking systems? → It reduces reliance on traditional banks by enabling direct transactions
26. Why is the Lightning Network considered a crucial development for Bitcoin's use in retail commerce? → It enables nearly instantaneous, low-cost payments suitable for small, everyday purchases.
27. What does 'P2PKH' stand for in Bitcoin scripting? → Pay-to-Public-Key-Hash
28. What is 'channel rebalancing' in the Lightning Network? → Redistributing funds across channels to maintain sending and receiving capacity
29. In asymmetric cryptography (also known as public-key cryptography), which key is kept secret and which is shared? → The private key is kept secret, and the public key is shared.
30. What is a 'timelock' in Bitcoin scripting? → A script condition that prevents spending until a specific block height or time