Deep Dive into XRPL DeFi Review Quiz

Where do AMMs store currency?

In a hedge fund.

In a decentralized exchange.

In a community moderated account.

In a liquidity pool.

What is an Order Book?

A queue of trades that are being processed.

A log of all the trades that happen on an exchange.

A list of traders who want to buy a specific token.

A list of offers from traders to buy or sell tokens for a specific exchange rate.

What should you look for when choosing a DeFi platform to ensure security?

Utilizing and trusting the platform's security features.

Understanding how security features like multi-signature authentication work.

Avoiding platforms that use encryption techniques.

Only using government-backed platforms.

When does the Order Book function the best?

When the price of tokens is highest.

When the price of tokens is lowest.

When there is a high volume of traders utilizing the platform.

When the exchange rate between tokens is most optimal for traders.

Where is the best place to store your private keys?

Written on a note.

Emailing them to yourself.

Remembering them.

In a hardware or software wallet.

What is one of the advantages that DeFi has over traditional finance systems?

DeFi has looser geographical restrictions.

DeFi requires complicated documentation.

DeFi is more transparent.

DeFi doesn’t require an account.

What should you consider when choosing a consensus mechanism for an EVM sidechain?

Choose the mechanism with the highest fees, making the barrier to entry higher.

Choose a mechanism that offers limited scalability.

Educate yourself on the mechanisms' strengths and weaknesses in terms of security and other factors.

Choose a Proof of Stake (PoS) mechanism for maximum decentralization.

What should you consider when choosing a consensus mechanism for an EVM sidechain?

Choose the mechanism with the highest fees, making the barrier to entry higher.

Choose a mechanism that offers limited scalability.

Educate yourself on the mechanisms' strengths and weaknesses in terms of security and other factors.

Choose a Proof of Stake (PoS) mechanism for maximum decentralization.

Why is the XRPL good for DeFi?

The XRPL’s Proof-of-Work and Proof-of-Stake systems make it difficult to hack.

The XRPL always gets the best exchange rate for trades.

The XRPL can handle a large volume of transactions quickly and cheaply.

The XRPL’s trading algorithm always nets the highest gains per transaction.

What is Pathfinding?

Pathfinding is the process of finding an efficient route for trading tokens between two Decentralized Exchanges (DEXs).

Pathfinding is the process of finding an efficient route for trading between two tokens on a DEX.

Pathfinding is the process of finding an efficient route for sending currency to others.

Pathfinding is the process of finding an efficient route for exchanging fiat currency for cryptocurrencies.