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Lesson # 1
Using Lending & Borrowing Protocols Like a Pro
Blockchain Basics
1. What is the main difference between aTokens and cTokens in DeFi lending platforms?
A. aTokens are minted on Bitcoin, cTokens on Ethereum
B. aTokens reflect real-time interest accrual, cTokens grow in value per block
C. cTokens can be used on centralized exchanges, aTokens cannot
D. aTokens require a subscription, cTokens do not
2. If you borrow up to the maximum Loan-to-Value (LTV) allowed, what happens if your collateral drops in value?
A. Your interest rate automatically increases
B. You risk liquidation of your position
C. You earn bonus rewards
D. The protocol lends you more
3. Which of the following best describes a delta-neutral strategy in DeFi?
A. Lending only on Layer 2 platforms
B. Holding positions that cancel out exposure to price movement
C. Borrowing more than your collateral
D. Using leverage to amplify profits
4. What is a key risk if a DeFi platform uses a faulty or manipulated oracle?
A. Gas fees increase sharply
B. cTokens stop accruing value
C. False liquidations and inaccurate collateral values may occur
D. Wallets get disconnected
5. What is a potential advantage of peer-to-peer (P2P) lending models in DeFi compared to pooled lending?
A. They eliminate all smart contract risk
B. They offer fixed interest rates regardless of market conditions
C. They can reduce the interest spread between lenders and borrowers
D. They do not require collateral for borrowing