DeFi Chapter 3

  1. What is ethereum?
    A global, open-source platform for decentralized apps.
  2. What happens after a smart contract is written?
    It is deployed to the ethereum network where it will run 24/7 and the network will keep track of the latest state.
  3. What is a Smart Contract?
    A smart contract is a programmable contract that allows two counterparties to set conditions of a transaction without needing to trust another third party for the execution.
  4. What principle do contracts work on?
    If this, then that.
  5. What is ETH
    Ether is the native currency of the Ethereum blockchain.
  6. Can ETH be used as money?
    Yes.
  7. What is used to pay gas fees in executing smart contracts?
    Ether
  8. What is gas?
    The fee required to execute a smart contract.
  9. The unit of measure on the amount of computational effort required to execute an operation or a smart contract is called?
    Gas
  10. Does the price of gas fluctuate?
    yes.
  11. Can gas fees be set manually?
    Yes.
  12. How are transactions prioritized for validation?
    Based on who is paying the higher gas fees. "Speed pass"
  13. What happens if the gas fees are too low?
    The transactions will be queued up.
  14. How is gas price denoted?
    1 gwei = .000000001 ether
  15. Formula for gas fees?
    gas * 3 gwei = 

    gwei = .000000001 ether

    21000 gas * 3 gwei = .000063

    21000 * (3 * .000000001) = .000063
  16. What are dapps?
    Interfaces that interact with the blockchain through the use of smart contracts.
  17. How are dapps different than traditional web apps?
    They interact with the blockchain.
  18. What are the benefits of decentralized blockchains?
    They are built on decentralized blockchains.

    Immutability info can't be changed

    Tamper-proof everyone is alerted of changes

    Transparent Smart contracts are auditable

    Availability as long as ETH network is alive so will the dapps
  19. What are the disadvantages of Dapps?
    immutable humans are prone to errors.

    Transparent become attack vectors find exploits

    Scalability limited to the blockchain it resides on
  20. What can ethereum be used for?
    Creating dapps. Creating:

    Decentralized Autonomous Organizations (DAO) or issuing other cryptocurrencies
  21. What is a DAO?
    A DAO is a fully autonomous organization that is not governed by a single person but is instead governed through code. This code is based on smart contracts and enables DAOs to replace how traditional organizations are typically run.
  22. What are the two popular protocols for creating tokens in Ethereum?
    ERC-20 and ERC-721.
  23. What is ERC-20?
    A protocol standard that defines rules and standards for issuing tokens on Ethereum.
  24. Are ERC-20 fungible?
    Yes.
  25. What is fungible?
    Interchangeable and of equal value.
  26. Are ERC-721 tokens fungible?
    No. They are unique and non-interchangeable.
Author
andres666
ID
355357
Card Set
DeFi Chapter 3
Description
Updated