Transactions & Verification Flashcards

What is a 'peel chain' transaction pattern, and how does it differ from a standard change output?

Answer: A peel chain repeatedly moves funds through single-input/two-output transactions to obscure the trail, unlike a one-time change output

Peel chains are serial transactions where most value moves forward and a small amount peels off each time, making fund tracing difficult for auditors.

In Ethereum EIP-1559, what is the 'base fee' and how does it impact transaction verification?

Answer: A dynamically adjusted per-block fee that is burned rather than paid to validators

EIP-1559 introduced a dynamic base fee that adjusts per block and is burned (not given to validators), reducing ETH supply and changing fee accounting.

What does 'transaction finality' mean, and which consensus mechanism provides probabilistic vs. absolute finality?

Answer: Finality means a transaction cannot be reversed; PoW gives probabilistic finality, BFT-based PoS gives absolute finality

PoW offers probabilistic finality (reversal becomes harder with more blocks), while BFT-based PoS systems like Tendermint provide deterministic, absolute finality after a round of voting.

Which type of blockchain address format provides the strongest evidence of transaction intent from an audit perspective?

Answer: Bech32 native SegWit (P2WPKH/P2WSH), because the witness data is explicit and non-malleable

Bech32 native SegWit addresses carry non-malleable witness data, making transaction signatures tamper-evident and easier to verify cryptographically.

A CCA auditor is reviewing a DeFi protocol. A transaction shows a flash loan borrow and repayment within the same block. What key audit concern does this raise?

Answer: Flash loans enable price manipulation or reentrancy attacks within one atomic transaction, requiring trace analysis of all internal calls

Flash loans are uncollateralized loans repaid within one transaction; auditors must trace all internal calls to detect price oracle manipulation or reentrancy exploitation.

What is the significance of the 'witness discount' introduced by SegWit for auditing transaction fees?

Answer: Witness data is counted at 1/4 the weight of non-witness data, making SegWit transactions cheaper and affecting fee-per-byte calculations

SegWit weights witness data at 0.25 of regular data, lowering the effective fee for SegWit transactions and requiring auditors to use virtual bytes (vbytes) rather than raw bytes for fee analysis.

During a blockchain forensics audit, what is the 'common input ownership heuristic' and what is its limitation?

Answer: It assumes all inputs in a transaction are controlled by the same entity; limited by CoinJoin and other mixing techniques

The common input ownership heuristic clusters addresses that co-sign a transaction as belonging to one wallet, but CoinJoin transactions deliberately combine inputs from multiple users to defeat this analysis.