Cryptocurrency Smart Contracts and dApps 3

Question 1

What is 'flash loan' arbitrage in DeFi?

Accepted Answer

Borrowing and repaying a large uncollateralized loan within a single transaction to exploit price differences

Answer

Flash loans are uncollateralized loans that must be borrowed and repaid within one atomic transaction; traders use them to exploit price discrepancies across DEXs at scale.

Question 2

Which consensus component do Ethereum smart contracts rely on for deterministic execution across all nodes?

Accepted Answer

The EVM (Ethereum Virtual Machine)

Answer

Every full node runs the same EVM, ensuring that executing the same smart contract bytecode with the same inputs always produces identical outputs, enabling consensus.

Question 3

What is 'slippage' in the context of a decentralized exchange (DEX)?

Accepted Answer

The difference between the expected price of a trade and the price at which it executes

Answer

Slippage occurs when large trades or low liquidity move the pool price between order submission and execution, causing the actual fill price to differ from the quoted price.

Question 4

In the context of dApps, what is 'wallet connect'?

Accepted Answer

An open protocol that links mobile wallets to desktop dApps via QR code

Answer

WalletConnect is a protocol that creates an encrypted connection between a dApp and a user's mobile wallet by scanning a QR code, enabling transaction signing without exposing private keys.

Question 5

What is the role of 'events' in a Solidity smart contract?

Accepted Answer

They emit logs that off-chain applications can listen to and index

Answer

Events emit structured log data to the transaction receipt, allowing front-end applications and indexers (like The Graph) to efficiently track on-chain activity without querying the full state.

Cryptocurrency Practice Test

Cryptocurrency Practice Test

Cryptocurrency Smart Contracts and dApps 3