A DeFi protocol is considering migrating from Proof of Work to Proof of Stake to reduce energy consumption. The protocol's governance token holders are concerned about the security implications of the transition. Which security consideration is most important to address during the migration?

Ensuring that the gas fees remain low after the transition.

Ensuring that the new Proof of Stake validators are geographically distributed.

Ensuring that the transition does not create a window for double-spending attacks.

Ensuring that the smart contracts are upgraded to be compatible with Proof of Stake.

A user is interacting with a DeFi protocol that requires them to approve a smart contract to spend their tokens. The user is concerned about security and wants to minimize the risk of the contract draining their entire balance. What should the user do?

Approve only the exact amount of tokens needed for the transaction.

Use a hardware wallet to store tokens, which prevents any smart contract from accessing them.

Approve an unlimited amount to avoid frequent approval transactions.

Revoke approval after each transaction to ensure the contract cannot spend tokens later.

In the Ethereum ecosystem, what is the primary role of an Ethereum account?

To represent a user or contract with a balance and state

To store the entire blockchain history

To validate transactions and produce blocks

To provide a user interface for interacting with dApps

A central bank is exploring the use of Ethereum for a wholesale central bank digital currency (CBDC) for interbank settlements. The bank requires that only authorized banks can hold and transfer the CBDC, and that the system can handle high throughput. Which approach is most suitable?

Use a private blockchain with a single validator

Deploy an ERC-20 token on Ethereum mainnet with a whitelist

Use a public Layer 2 solution with a whitelist

Deploy a permissioned Ethereum-based network with a limited set of validators and a native token

EC-CouncilBlockchain Fintech Certification

Domain 6Objective 6

Ethereum Ecosystem, EVM, and Role in Financial Markets BFC Practice Questions (Page 9)

Part of the Digital Currencies and Cryptocurrencies domain, which makes up ~15% of our current practice bank.

45questions here

9free pages

7concepts

Questions 41–45

41expert · hard
A DeFi protocol is considering migrating from Proof of Work to Proof of Stake to reduce energy consumption. The protocol's governance token holders are concerned about the security implications of the transition. Which security consideration is most important to address during the migration?
Select an answer first
42application · medium
A user is interacting with a DeFi protocol that requires them to approve a smart contract to spend their tokens. The user is concerned about security and wants to minimize the risk of the contract draining their entire balance. What should the user do?
Select an answer first
43application · medium
A developer is creating a dApp that lets users mint and trade unique digital art. The dApp must ensure that each piece of art is uniquely identified and cannot be duplicated. Which Ethereum standard should the developer use?
Select an answer first
44foundation · easy
In the Ethereum ecosystem, what is the primary role of an Ethereum account?
Select an answer first
45expert · hard
A central bank is exploring the use of Ethereum for a wholesale central bank digital currency (CBDC) for interbank settlements. The bank requires that only authorized banks can hold and transfer the CBDC, and that the system can handle high throughput. Which approach is most suitable?
Select an answer first

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