Interoperability Innovations BDC Practice Questions (Page 6)

Questions 26–30

1. 26foundation · easy

   What is the primary function of a hash time-locked contract (HTLC) in cross-chain communication?

   • ATo permanently lock funds in a smart contract with no way to retrieve them
   • BTo encrypt all transaction data on a blockchain so that only miners can read it
   • CTo increase the block size of a blockchain to allow more transactions
   • DTo enable atomic swaps by ensuring that either both parties receive the assets or neither does
   Reveal Solution Discussion Select an answer first
2. 27foundation · easy

   Which statement best describes an atomic swap?

   • AA method for merging two blockchains into one chain
   • BA process for increasing the block reward of a cryptocurrency
   • CA peer-to-peer exchange of assets between two parties on different blockchains that either happens completely or not at all
   • DA centralized exchange service that holds users' funds in a single wallet
   Reveal Solution Discussion Select an answer first
4. 28foundation · easy

   What is a common security risk associated with blockchain bridges?

   • AExploitation of vulnerabilities in the bridge's smart contracts
   • BThe bridge automatically deletes all data after each transaction
   • CThe bridge requires users to share their private keys
   • DThe bridge increases the block reward for miners
   Reveal Solution Discussion Select an answer first
5. 29application · medium

   A consortium of banks wants to connect several independent permissioned blockchains to share KYC data, but they do not want any single chain to become a central hub. They need a standard protocol that allows each chain to maintain its own sovereignty while interoperating. Which solution aligns with these requirements?

   • ADeploy a single shared smart contract on a public blockchain to coordinate all KYC data.
   • BUse a notary scheme where one trusted bank signs off on all cross-chain messages.
   • CAdopt the Cosmos SDK and use the Inter-Blockchain Communication (IBC) protocol between zones.
   • DBuild a custom relay chain that all other chains must connect to for message passing.
   Reveal Solution Discussion Select an answer first
6. 30foundation · easy

   Which mechanism is commonly used to enable cross-chain communication without a trusted intermediary?

   • AA centralized custodian that holds funds on both chains
   • BA manual process where users send assets to each other via email
   • CHash time-locked contracts (HTLCs)
   • DA shared database that all blockchains write to
   Reveal Solution Discussion Select an answer first