CBP Wallets and Key Management 3

Question 1

What does a Bitcoin watch-only wallet contain?

Accepted Answer

Public keys or addresses but no private keys

Answer

A watch-only wallet holds public keys or addresses, allowing monitoring of balances and transactions without the ability to sign and spend.

Question 2

In a 2-of-3 multisig wallet, what is the minimum number of signatories needed to broadcast a transaction?

Accepted Answer

2

Answer

A 2-of-3 multisig requires exactly 2 of the 3 private keys to sign a transaction before it can be valid and broadcast.

Question 3

What is the function of the chain code in BIP-32 HD key derivation?

Accepted Answer

It serves as additional entropy to prevent key derivation from the parent key alone

Answer

The chain code is combined with the parent key in the HMAC-SHA512 function, ensuring child keys cannot be derived from the parent key alone.

Question 4

When backing up a BIP-39 mnemonic phrase, which practice is considered most secure?

Accepted Answer

Writing it on a steel plate and storing offline in multiple secure locations

Answer

Metal backups stored offline in separate secure locations resist fire, water, and physical theft while avoiding digital exposure.

Question 5

What is a 'brain wallet' and what is its primary security weakness?

Accepted Answer

A wallet derived from a memorized passphrase; weakness is low entropy from human-chosen phrases

Answer

Brain wallets derive keys from passphrases that humans choose, which have far less entropy than cryptographically random seeds and are vulnerable to dictionary attacks.

(CBP) Certified Bitcoin Professional Practice Test

(CBP) Certified Bitcoin Professional Practice Test

CBP Wallets and Key Management 3