Types of Tokens and Digital Assets BDC Practice Questions (Page 3)

Questions 11–15

1. 11application · medium

   A startup is launching a token that gives holders voting rights on platform decisions and a share of platform profits. The team wants to avoid securities classification if possible. Which feature is most likely to cause the token to be classified as a security?

   • AThe token is used for governance voting.
   • BThe token is transferable between users.
   • CThe token is built on Ethereum using ERC-20.
   • DThe token provides profit-sharing rights to holders.
   Reveal Solution Discussion Select an answer first
2. 12application · medium

   A developer is building a platform that needs to issue both a fungible reward point and a non-fungible achievement badge in the same smart contract to reduce deployment costs. Which token standard should the developer choose?

   • AERC-721
   • BERC-1155
   • CERC-777
   • DERC-20
   Reveal Solution Discussion Select an answer first
4. 13expert · hard

   A financial institution wants to tokenize a portfolio of bonds. Each bond has a unique ISIN and a fixed interest rate. The institution wants to allow institutional investors to trade these bonds on a blockchain while ensuring compliance with financial regulations. Which approach best meets these requirements?

   • AIssue ERC-1155 tokens with each bond as a token ID and balances representing fractions.
   • BIssue a separate ERC-20 security token for each bond, with the token supply representing the bond's face value, and implement KYC/AML checks.
   • CIssue ERC-721 tokens for each bond, with each token representing the entire bond.
   • DIssue a single ERC-20 token for all bonds, with the balance representing the total portfolio value.
   Reveal Solution Discussion Select an answer first
5. 14application · medium

   A real estate firm is tokenizing a commercial building. They want to sell shares of the property to multiple investors, where each share represents an equal fraction of ownership and can be freely traded on secondary markets. Which token type best fits this requirement?

   • AGovernance token for voting
   • BNon-fungible token representing the deed
   • CFungible security token
   • DUtility token for platform access
   Reveal Solution Discussion Select an answer first
6. 15application · medium

   A company wants to tokenize a portfolio of invoices to allow investors to buy fractions of the portfolio. Each investor will receive a pro-rata share of the cash flows. The company wants to ensure that the tokens are compliant with securities laws. Which step is most critical in the tokenization process?

   • AChoose a blockchain with the fastest transaction speed.
   • BStore the invoice data on-chain to ensure transparency.
   • CConduct a legal review to determine if the tokens are securities and register them accordingly.
   • DEnsure the tokens are fungible using ERC-20.
   Reveal Solution Discussion Select an answer first