CCE Security & Risk Management 5

Question 1

What is a 'flash loan attack' in DeFi?

Accepted Answer

Exploiting uncollateralized loans to manipulate markets and drain protocols within one transaction

Answer

Flash loans allow uncollateralized borrowing within a single transaction; attackers use them to manipulate prices or exploit vulnerabilities and return the loan atomically.

Question 2

Which practice helps protect against supply chain attacks on cryptocurrency software?

Accepted Answer

Verifying software checksums and cryptographic signatures before installation

Answer

Verifying SHA-256 checksums and developer PGP signatures confirms that downloaded software hasn't been tampered with in the distribution chain.

Question 3

What is 'Miner Extractable Value' (MEV) and why is it a security concern?

Accepted Answer

Value miners or validators extract by reordering, inserting, or censoring transactions for profit

Answer

MEV allows block producers to profit by reordering or inserting transactions, creating unfair advantages and potentially harming regular users through sandwich attacks.

Question 4

What security vulnerability does a 'backdoored' random number generator (RNG) introduce in cryptocurrency?

Accepted Answer

Predictable private keys that attackers can compute without brute force

Answer

A backdoored RNG produces seemingly random but actually predictable outputs, allowing the backdoor creator to derive private keys generated using that RNG.

Question 5

Which control best mitigates the risk of an insider threat at a cryptocurrency exchange?

Accepted Answer

Implementing separation of duties and privileged access management

Answer

Separation of duties ensures no single employee can complete a sensitive action alone, while privileged access management limits and logs elevated access.

(CCE) Certified Cryptocurrency Expert Practice Test

(CCE) Certified Cryptocurrency Expert Practice Test

CCE Security & Risk Management 5