Cryptocurrency Smart Contracts and Token Standards 2

Question 1

What is the ERC-20 token standard?

Accepted Answer

A set of rules defining a common interface for fungible tokens on Ethereum

Answer

ERC-20 defines a standard interface for fungible tokens on Ethereum, ensuring interoperability between wallets, DEXs, and dApps.

Question 2

What distinguishes an ERC-721 token from an ERC-20 token?

Accepted Answer

ERC-721 tokens are non-fungible, meaning each token is unique and not interchangeable

Answer

ERC-721 tokens are non-fungible, meaning each token has unique properties and cannot be exchanged on a 1:1 basis with other tokens.

Question 3

What is the ERC-1155 token standard?

Accepted Answer

A multi-token standard that supports both fungible and non-fungible tokens in one contract

Answer

ERC-1155 is a multi-token standard that allows a single contract to manage both fungible and non-fungible tokens, reducing deployment costs.

Question 4

What is an Initial Coin Offering (ICO)?

Accepted Answer

A fundraising method where new tokens are sold to investors in exchange for capital

Answer

An ICO is a fundraising mechanism where a project sells newly created tokens to early investors to raise capital for development.

Question 5

What is token vesting in cryptocurrency projects?

Accepted Answer

A schedule that gradually releases tokens to recipients over time

Answer

Token vesting is a time-based release schedule that gradually unlocks tokens for founders, team members, or investors to align long-term incentives.

Cryptocurrency Practice Test