Cryptocurrency & Smart Contracts Flashcards

What is the primary purpose of cryptocurrency?

Answer: To provide secure and decentralized transactions

Cryptocurrency is a digital asset that operates on blockchain technology to facilitate secure and decentralized transactions.

Which blockchain network is most commonly associated with smart contracts?

Answer: Ethereum

Ethereum is the most widely used blockchain for deploying smart contracts, allowing automated transactions without intermediaries.

How do smart contracts execute transactions?

Answer: By automatically executing predefined conditions

Smart contracts are self-executing programs that trigger transactions when predefined conditions are met, removing the need for intermediaries.

Which feature makes cryptocurrency transactions secure?

Answer: Cryptographic encryption

Cryptographic encryption ensures that cryptocurrency transactions are secure, tamper-proof, and protected from fraud.

What is the main advantage of using smart contracts in financial transactions?

Answer: They reduce costs and speed up transactions

Smart contracts eliminate the need for intermediaries, reducing costs and increasing transaction speed and security.

Which factor can impact the scalability of smart contracts?

Answer: Network congestion

Network congestion can slow down smart contract execution, increasing fees and reducing efficiency in blockchain transactions.