Cryptomining and the Mining Ecosystem BDC Practice Questions (Page 7)

Questions 31–35

1. 31foundation · easy

   Which statement accurately describes the relationship between mining software and a mining pool?

   • AMining software is only used when mining without a pool
   • BMining software connects the miner's hardware to the pool's server to receive work and submit results
   • CMining software replaces the mining pool by providing its own consensus mechanism
   • DMining software automatically selects the most profitable cryptocurrency to mine
   Reveal Solution Discussion Select an answer first
2. 32expert · hard

   A Proof of Work blockchain has seen increasing centralization of mining power. The community is considering changes to reduce this trend. Which proposed change would most directly address the root cause of centralization?

   • AIncrease the block reward to attract more miners to the network.
   • BRequire miners to register their identity with the network to improve accountability.
   • CAdopt an ASIC-resistant hashing algorithm to allow commodity GPUs to mine competitively.
   • DIncrease the mining difficulty to make it harder for any single miner to dominate.
   Reveal Solution Discussion Select an answer first
4. 33application · medium

   A blockchain network uses Proof of Work. An attacker wants to reverse a confirmed transaction. Which property of the network directly makes this attack economically infeasible?

   • AThe protocol automatically rejects any block that contains a transaction that was previously included in an earlier block.
   • BThe difficulty adjustment ensures that the network's total hashrate remains constant over time.
   • CThe network's block reward is paid to miners only after a 100-block maturity period.
   • DEach block requires a cryptographic hash below a target, and recomputing all subsequent blocks requires enormous computational work.
   Reveal Solution Discussion Select an answer first
5. 34expert · hard

   A Proof of Work network is experiencing a steady decline in hash rate because mining is becoming unprofitable for many small miners. The difficulty adjustment is scheduled to occur soon. What is the likely effect on the network?

   • AThe network will automatically switch to a Proof of Stake consensus to reduce energy consumption.
   • BDifficulty will decrease, making it easier to find blocks, which may attract some miners back and stabilize the network.
   • CDifficulty will increase, making mining even harder and accelerating the exodus of small miners.
   • DThe block reward will be increased to compensate for the lower hash rate.
   Reveal Solution Discussion Select an answer first
6. 35application · medium

   A new blockchain project wants to launch with a fair distribution of mining power. The team is concerned about large mining pools dominating the network from the start. Which strategy would best mitigate this risk?

   • APre-mine a large portion of the coins and distribute them to early supporters.
   • BSet a very high mining difficulty to discourage small miners from participating.
   • CUse a Proof of Stake consensus to avoid mining altogether.
   • DDesign the mining algorithm to be ASIC-resistant and memory-hard, encouraging CPU and GPU mining.
   Reveal Solution Discussion Select an answer first