CCE NFTs, Tokenization, and Digital Assets

Question 1

What makes a Non-Fungible Token (NFT) different from a fungible cryptocurrency like Bitcoin?

Accepted Answer

NFTs are unique and non-interchangeable, each with distinct metadata and ownership records

Answer

NFTs use a different consensus mechanism than fungible tokens

Answer

NFTs can only be created on the Ethereum network

Answer

NFTs do not require a blockchain for ownership verification

Question 2

Which Ethereum token standard is specifically designed for Non-Fungible Tokens (NFTs)?

Accepted Answer

ERC-721

Answer

ERC-20

Answer

ERC-1400

Answer

ERC-4626

Question 3

What is the role of metadata in an NFT?

Accepted Answer

Metadata contains the descriptive attributes and media (image, video) associated with the NFT

Answer

Metadata stores the gas fee history for the NFT's transactions

Answer

Metadata records the staking rewards earned by the NFT holder

Answer

Metadata defines the smart contract bytecode for the NFT collection

Question 4

What does 'tokenization of real-world assets' (RWA) mean in cryptocurrency?

Accepted Answer

Representing ownership of tangible assets (real estate, commodities, equities) as blockchain tokens

Answer

Converting physical cash into cryptocurrency on a centralized exchange

Answer

Creating stablecoins backed by fiat currency reserves

Answer

Issuing NFTs that depict images of real-world objects

Question 5

What is a royalty mechanism in an NFT smart contract?

Accepted Answer

A percentage of secondary sale proceeds automatically sent to the original creator via the smart contract

Answer

A fee paid to the NFT marketplace for listing an item

Answer

A reward distributed to NFT holders for holding tokens over time

Answer

A gas refund issued to buyers of high-value NFTs

Question 6

What is IPFS and why is it commonly used for NFT storage?

Accepted Answer

A decentralized peer-to-peer file storage protocol that provides content-addressed, censorship-resistant media hosting

Answer

A centralized cloud database used to store NFT auction history

Answer

An Ethereum layer-2 solution for reducing NFT minting gas costs

Answer

A blockchain indexing service used by NFT marketplaces to query ownership data