Module #19. Cryptocurrency foolproof
me study guide Questions with correct
Answers
Some crypto exchanges allow their customers to "employ leverage", and why is this not
a good idea, according to Foolproof? What best describes this sentence? – answer C.
You can use borrowed money to increase the potential return of an investment. Seeing
the volatile nature of cryptos, your debt can quadruple in minutes.
What is a stablecoin? - answer A. A crypto that is attached to another currency's value.
You have your crypto portfolio (all the different cryptos you own) in a cold wallet (not
connected) at a custodial crypto exchange (like Coinbase). Are your cryptos FDIC
insured? – answer B. No.
When does a token become a coin? – answer B. When its own blockchain is developed
to record the transactions on.
If you used fiat currency - like our US dollar - to just buy crypto assets, you do not have
to report anything about it on your return. - answer True.
What characterizes a crypto broker? – answer D. Buying and selling of cryptos, as well
as trading.
How do you recognize a potential pump and dump scheme in a chart price trend? –
answer B. The price is relatively low for a while, after which a sharp price rise occurs,
followed by a sharp sudden fall, creating a sharp "peak" in the chart.
What's the difference between a custodial and a non-custodial wallet? – answer C. With
custodial wallets, the private key is held by a third party. With non-custodial wallets,
users are themselves responsible and in full control of their assets.
Which statements characterize Decentralized Finance (DeFi)? Select the best answer.
– answer G. All of the Above.
You have a certain amount of anonymity, and sometimes even full anonymity.
The money streams are transparent and for everyone to see.
No need for a central bank or government to approve transactions.
me study guide Questions with correct
Answers
Some crypto exchanges allow their customers to "employ leverage", and why is this not
a good idea, according to Foolproof? What best describes this sentence? – answer C.
You can use borrowed money to increase the potential return of an investment. Seeing
the volatile nature of cryptos, your debt can quadruple in minutes.
What is a stablecoin? - answer A. A crypto that is attached to another currency's value.
You have your crypto portfolio (all the different cryptos you own) in a cold wallet (not
connected) at a custodial crypto exchange (like Coinbase). Are your cryptos FDIC
insured? – answer B. No.
When does a token become a coin? – answer B. When its own blockchain is developed
to record the transactions on.
If you used fiat currency - like our US dollar - to just buy crypto assets, you do not have
to report anything about it on your return. - answer True.
What characterizes a crypto broker? – answer D. Buying and selling of cryptos, as well
as trading.
How do you recognize a potential pump and dump scheme in a chart price trend? –
answer B. The price is relatively low for a while, after which a sharp price rise occurs,
followed by a sharp sudden fall, creating a sharp "peak" in the chart.
What's the difference between a custodial and a non-custodial wallet? – answer C. With
custodial wallets, the private key is held by a third party. With non-custodial wallets,
users are themselves responsible and in full control of their assets.
Which statements characterize Decentralized Finance (DeFi)? Select the best answer.
– answer G. All of the Above.
You have a certain amount of anonymity, and sometimes even full anonymity.
The money streams are transparent and for everyone to see.
No need for a central bank or government to approve transactions.
