Bitcoin Mining, Forking, and Scalability Solutions BDC Practice Questions (Page 9)

Questions 41–45

1. 41application · medium

   A startup wants to accept Bitcoin micropayments for digital content, but the per-transaction fees on the base layer are too high. They are considering the Lightning Network. Which statement accurately describes how the Lightning Network reduces fees and improves scalability?

   • AIt enables off-chain transactions through a network of payment channels, settling only the final balances on-chain.
   • BIt creates a new cryptocurrency with lower fees that is pegged to Bitcoin.
   • CIt increases the block size limit to allow more transactions per block.
   • DIt batches multiple transactions into a single on-chain transaction, reducing the number of blocks needed.
   Reveal Solution Discussion Select an answer first
2. 42foundation · easy

   What is a payment channel in the Lightning Network?

   • AA special type of Bitcoin address that holds funds for multiple users
   • BA sidechain that runs parallel to the main Bitcoin blockchain
   • CA two-party relationship that allows multiple transactions to be conducted off-chain without broadcasting each one to the blockchain
   • DA smart contract that automatically adjusts transaction fees
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4. 43application · medium

   A new miner joins the Bitcoin network and wants to understand the mining process. They have collected pending transactions and are ready to create a block. What is the correct sequence of steps they must follow?

   • AAssemble the block, broadcast it, then wait for other miners to verify it.
   • BBroadcast the block first, then verify transactions, then compute a nonce.
   • CCompute a nonce first, then verify transactions, then assemble the block.
   • DVerify transactions, assemble a block, compute a valid nonce, broadcast the block to the network.
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5. 44application · medium

   A blockchain startup wants to increase transaction throughput without changing Bitcoin's consensus rules. Which approach aligns with this constraint?

   • AEncourage miners to use more efficient hardware to reduce block time.
   • BAdopt sharding to split the blockchain into multiple parallel chains.
   • CImplement a sidechain that processes transactions independently and periodically settles to Bitcoin.
   • DPropose a hard fork to increase the block size limit.
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6. 45foundation · easy

   What is the primary role of miners in the Bitcoin network?

   • ATo store the entire blockchain and serve it to light clients
   • BTo approve or reject transactions based on their own discretion
   • CTo validate transactions and secure the network by creating new blocks
   • DTo set the transaction fees for each block
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