Practice Test Geeks(CBP) Certified Bitcoin Professional Practice Test
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Bitcoin Transactions and Wallets Flashcards

7 cards from real CBP practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.

Read the first 7 Bitcoin Transactions and Wallets flashcards as text

  1. What is the primary advantage of a hardware wallet over a software wallet?

    Answer: Private keys never leave the device, protecting them from internet-connected malware

    Hardware wallets store private keys in a secure element and sign transactions internally, so keys are never exposed to potentially compromised computers.

  2. In the Bitcoin UTXO model, what is 'coin selection'?

    Answer: The algorithm a wallet uses to choose which UTXOs to combine as inputs for a new transaction

    Coin selection algorithms determine which UTXOs to use as inputs to minimize fees, avoid change, or improve privacy.

  3. What is a 'watch-only' wallet?

    Answer: A wallet that has the public keys/addresses to monitor balances but cannot sign transactions

    Watch-only wallets contain public keys or addresses to track balances and history without holding the private keys needed to spend.

  4. What does it mean for a Bitcoin transaction to be 'in the mempool'?

    Answer: The transaction has been broadcast to the network but not yet included in a block

    The mempool (memory pool) is each node's local holding area for valid but unconfirmed transactions awaiting block inclusion.

  5. Which of the following best describes a P2WPKH (Pay-to-Witness-Public-Key-Hash) address?

    Answer: A native SegWit address starting with 'bc1q' that stores the hash of a public key in the witness field

    P2WPKH is a native SegWit (bech32) address type beginning with 'bc1q' that places signature data in the segregated witness field.

  6. Why is address reuse considered a privacy risk in Bitcoin?

    Answer: It links multiple transactions to the same entity, enabling blockchain analysis to trace spending patterns

    When the same address appears in multiple transactions, it allows observers to cluster those transactions and associate them with a single user.

  7. What is the function of OP_RETURN in a Bitcoin transaction output?

    Answer: Creates an unspendable output that embeds arbitrary data on the blockchain

    OP_RETURN marks an output as provably unspendable and allows up to 80 bytes of arbitrary data to be recorded on-chain.