Principles of Web3 and the Role of DAOs BBLC Practice Questions (Page 1)

Questions 1–5

1. 1expert · hard

   A Web3 startup wants to offer users true data portability and interoperability across multiple applications. They are evaluating whether to build on a single blockchain or use a cross-chain interoperability protocol. The team is concerned about security risks and user experience. Which approach best addresses these concerns?

   • ABuild on a single, widely adopted blockchain and use standardized token and identity standards to ensure portability across applications on that chain.
   • BUse a cross-chain bridge for every asset transfer to maximize interoperability.
   • CUse a centralized exchange to handle all cross-chain transfers.
   • DBuild a proprietary API that locks users into the startup's platform.
   Reveal Solution Discussion Select an answer first
2. 2application · medium

   An open-source software project wants to transition to a DAO to manage its treasury and decide which features to develop. The team is concerned about legal liability and wants to ensure that the DAO can enter into contracts and hold assets in a recognized manner. What should they consider?

   • ARegister the DAO as a trademark to gain legal recognition.
   • BEstablish the DAO as a legal entity, such as a limited liability company (LLC) or foundation, in a jurisdiction that recognizes DAOs.
   • CKeep the DAO as an unincorporated association with no legal status.
   • DUse a smart contract only and rely on the code as the sole legal agreement.
   Reveal Solution Discussion Select an answer first
4. 3expert · hard

   A DAO that manages a decentralized prediction market is facing a dispute over the outcome of a real-world event. The oracle data is ambiguous, and the community is divided. The DAO wants to resolve the dispute fairly and maintain trust in the platform. Which resolution mechanism is most aligned with DAO principles?

   • AUse a decentralized arbitration layer where a randomly selected jury of token holders votes on the outcome, with the option to appeal to a larger jury.
   • BLet the platform's founder decide the outcome.
   • CUse a centralized oracle service to provide a definitive answer.
   • DCancel all bets and refund users.
   Reveal Solution Discussion Select an answer first
5. 4expert · hard

   A DAO is considering upgrading its smart contract to fix a critical vulnerability. The upgrade requires migrating user funds to a new contract. The community is concerned about the risk of theft during the migration and about the legitimacy of the upgrade. Which approach best mitigates these risks?

   • AConduct a time-locked upgrade with a community vote, and use a migration contract that has been audited by multiple independent firms.
   • BUpgrade the contract immediately using the admin key to fix the vulnerability as fast as possible.
   • CDo not upgrade and hope the vulnerability is not exploited.
   • DMigrate funds manually by having each user send their funds to a new address.
   Reveal Solution Discussion Select an answer first
6. 5application · medium

   A DAO wants to reduce the risk of a malicious proposal passing due to low voter turnout. Which governance design change is most directly aimed at this problem?

   • ARequiring a minimum quorum of voting power for a proposal to be valid
   • BAllowing the founding team to veto any proposal
   • CIncreasing the number of tokens required to create a proposal
   • DShortening the voting period to encourage faster decisions
   Reveal Solution Discussion Select an answer first