Regulatory Compliance and Legal Frameworks in Blockchain BBLC Practice Questions (Page 7)

Questions 31–35

1. 31foundation · easy

   Which of the following is a common approach that regulators use to address cross-border blockchain activities?

   • AIgnoring blockchain activities because they are too complex
   • BBanning all blockchain technology within their borders
   • CApplying extraterritorial jurisdiction to activities that affect their citizens or markets
   • DDelegating all regulation to international bodies
   Reveal Solution Discussion Select an answer first
2. 32application · medium

   Two companies enter into a smart contract for the automated delivery of goods. The smart contract executes payment upon delivery confirmation from an IoT sensor. A dispute arises because the sensor malfunctioned and triggered payment before delivery. Under traditional contract law, which factor is most relevant to the enforceability of the smart contract?

   • AWhether the smart contract code is open source and audited.
   • BWhether the parties intended the smart contract to be a legally binding agreement.
   • CWhether the smart contract runs on a permissioned or public blockchain.
   • DWhether the smart contract includes a dispute resolution clause.
   Reveal Solution Discussion Select an answer first
4. 33application · medium

   A blockchain-based remittance service plans to operate in multiple countries. The service will allow users to send fiat currency and digital assets across borders. The compliance team must design a framework that satisfies regulators in all operating jurisdictions. What is the most effective first step?

   • AUse a decentralized architecture to avoid being classified as a financial institution anywhere.
   • BImplement a single global KYC standard that meets the highest requirement in any jurisdiction.
   • CConduct a comprehensive jurisdictional risk assessment to identify applicable licensing, AML, and data protection requirements.
   • DObtain a money transmitter license in the most restrictive jurisdiction and operate under that license everywhere.
   Reveal Solution Discussion Select an answer first
5. 34application · medium

   A company uses a smart contract to process insurance claims. The smart contract stores claimant personal data on-chain. The company must comply with GDPR. Which action is most appropriate?

   • AUse a private blockchain to avoid GDPR because it is not public.
   • BObtain consent from claimants to store their data permanently on-chain.
   • CEncrypt the personal data on-chain and store the decryption key with the claimant.
   • DRefactor the smart contract to store only claim IDs on-chain and keep personal data in an off-chain database.
   Reveal Solution Discussion Select an answer first
6. 35application · medium

   A blockchain company is monitoring regulatory developments in the EU, where the Markets in Crypto-Assets Regulation (MiCA) is being implemented. The company issues a stablecoin pegged to the euro. Which action is most directly required by MiCA?

   • ARegister with a national financial regulator but only for AML purposes.
   • BEnsure the stablecoin is backed by a basket of assets to avoid being classified as an e-money token.
   • CRely on the existing e-money directive because the stablecoin is pegged to a fiat currency.
   • DObtain authorization as a crypto-asset service provider and comply with reserve and redemption requirements.
   Reveal Solution Discussion Select an answer first