Digital Currency
Overview
More and more money never takes a physical form at all. When you tap a card or pay through an app, no coins or notes change hands; only data moves between computers. Digital currency is that money, and cryptocurrencies push the idea further by removing the bank from the middle altogether.
In this lesson you will learn what a digital currency is and how it is used, then meet the problem a decentralised currency creates: with no bank in charge, how do you stop people cheating? The answer is the blockchain, a tamper-evident digital ledger, and you will follow exactly how it records and protects every transaction.
Objectives
- 1 Understand the concept of a digital currency and how digital currencies are used
- 2 Understand the process of blockchain and how it is used to track digital currency transactions
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Flashcards
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Lesson Note
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Lesson Evaluation
Congratulations on completing the lesson on Digital Currency. Now that youve explored the key concepts and ideas, its time to put your knowledge to the test. This section offers a variety of practice questions designed to reinforce your understanding and help you gauge your grasp of the material.
You will encounter a mix of question types, including multiple-choice questions, short answer questions, and essay questions. Each question is thoughtfully crafted to assess different aspects of your knowledge and critical thinking skills.
Use this evaluation section as an opportunity to reinforce your understanding of the topic and to identify any areas where you may need additional study. Don't be discouraged by any challenges you encounter; instead, view them as opportunities for growth and improvement.
- A digital currency is best described as a currency that: A. exists only as coins and notes B. exists electronically rather than physically C. can never be used online D. is controlled by a single shop Answer: B
- Which protocol is used to encrypt digital-currency payment data sent between computers? A. HTTP B. FTP C. HTTPS D. SMTP Answer: C
- A cryptocurrency such as Bitcoin uses which type of system? A. centralised B. decentralised C. manual D. analogue Answer: B
- What is the digital ledger in a blockchain? A. a single encrypted password B. a list of all the transactions recorded by the blockchain C. a type of cookie D. the bank's central computer Answer: B
- Once a transaction has been added to a blockchain ledger, it: A. can be edited by anyone B. is deleted after a day C. cannot be changed D. becomes private and unviewable Answer: C
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