Practice Test Geeks(CBP) Certified Bitcoin Professional Practice Test
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Wallets and Key Management Flashcards

7 cards from real CBP practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.

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  1. What is the primary advantage of using a hardware wallet over a software wallet?

    Answer: Private keys are generated and stored on an isolated device and never exposed to internet-connected systems

    Hardware wallets keep private keys in a secure element isolated from networked devices, so signing happens on the device and keys are never exported.

  2. What is a PSBT (Partially Signed Bitcoin Transaction)?

    Answer: A transaction format allowing multiple parties to collaboratively sign before finalization

    PSBT (BIP-174) defines a portable format for transactions that can be passed between wallets for signing by multiple parties before being finalized and broadcast.

  3. What is 'address reuse' and why does it reduce privacy?

    Answer: Sending to the same Bitcoin address multiple times; it links all transactions to a single identity on the public blockchain

    Reusing addresses allows blockchain analysts to cluster all transactions involving that address, linking them to a single entity and reducing financial privacy.

  4. Which key derivation function does BIP-39 use to convert a mnemonic phrase into a binary seed?

    Answer: PBKDF2-HMAC-SHA512

    BIP-39 specifies PBKDF2 with HMAC-SHA512, 2048 iterations, using the mnemonic as the password and 'mnemonic' + optional passphrase as the salt.

  5. What does 'air-gapping' a signing device accomplish for key security?

    Answer: It physically isolates the device from all network connections, preventing remote key extraction

    An air-gapped signing device has no network interface, meaning private keys cannot be exfiltrated remotely — transactions are transferred via QR codes or USB.

  6. In Bitcoin, what is the relationship between a private key and its corresponding public key?

    Answer: The public key is derived from the private key using elliptic curve multiplication, but the reverse is computationally infeasible

    Elliptic curve discrete logarithm problem ensures that while public keys are easily derived from private keys via point multiplication on secp256k1, reversing the operation is computationally infeasible.

  7. What is the purpose of a 'change address' in a Bitcoin transaction?

    Answer: To return unspent UTXO value back to the sender when outputs don't exactly match inputs

    When a UTXO is spent, any remaining value not sent to the recipient or used as fees must be sent to a change address controlled by the sender.