CCI Smart Contracts and DeFi Investigations 2

Question 1

What is a Decentralized Exchange (DEX)?

Accepted Answer

A platform that facilitates peer-to-peer crypto trading via smart contracts without a central authority

Answer

A cryptocurrency exchange operated by a government agency

Answer

An exchange that operates across multiple countries under a single license

Answer

A hardware wallet used for secure trading

Question 2

Why is tracing funds through DeFi protocols particularly challenging for cryptocurrency investigators?

Accepted Answer

DeFi protocols can route funds across multiple pools, contracts, and chains, obscuring the trail

Answer

DeFi protocols are not recorded on any blockchain

Answer

Smart contracts automatically encrypt all transaction data end-to-end

Answer

All DeFi transactions require government approval before execution

Question 3

What is the primary purpose of a security audit in smart contract development?

Accepted Answer

To identify vulnerabilities and coding flaws before deployment

Answer

To register the contract with regulatory authorities

Answer

To increase the contract's transaction throughput speed

Answer

To reduce gas fees for end users

Question 4

What is a re-entrancy attack in smart contract security?

Accepted Answer

When an attacker forces a smart contract to call an external contract before completing its own state updates

Answer

An attack where the same transaction is broadcast multiple times to the network

Answer

A type of Sybil attack targeting validator nodes in a network

Answer

An exploit that reverses already-confirmed blockchain transactions

Question 5

What is a liquidity pool in DeFi?

Accepted Answer

A smart contract holding reserves of two or more tokens to enable automated trading

Answer

A reserve of cryptocurrency held in cold storage by a centralized exchange

Answer

A group of investors who coordinate large block trades to move markets

Answer

A cold storage solution for institutional crypto investors

Question 6

In Ethereum, what does 'gas' represent?

Accepted Answer

The computational fee required to execute transactions and smart contract operations

Answer

The native cryptocurrency used to pay validators on the Ethereum network

Answer

A measure of the blockchain's total storage capacity

Answer

The speed rating at which transactions are confirmed per second

Question 7

What is a governance token in DeFi?

Accepted Answer

A token that grants holders voting rights over protocol decisions and upgrades

Answer

A token issued by government agencies for blockchain compliance purposes

Answer

A stablecoin used exclusively for paying transaction fees on a protocol

Answer

A token that represents fractional ownership of physical real-world assets