Exam (elaborations)
CAIA LEVEL II EXAM SET QUESTIONS WITH COMPLETE SOLUTIONS
- Course
- Institution
CAIA LEVEL II EXAM SET QUESTIONS WITH COMPLETE SOLUTIONS
[Show more]
Content preview
CAIA LEVEL II EXAM SET QUESTIONSWITH COMPLETE SOLUTIONS
Token - Answer-Blockchain asset
Stablecoins - Answer-Asset underlying smart contracts
Asset-based decentralized derivative - Answer-Follow price movements of underlying
assets
Event-based decentralized derivatives - Answer-Value based on probability of event
occuring
Web 3.0 - Answer-Third generation internet based on distributed ledger technology
(DLT), provides peer-to-peer automated services
Decentralized finance - Answer-Web 3.0 financial services built with 'smart contracts'
(automated algorithms) on distributed ledger networks
Tokenization - Answer-Linking an asset to a digital token with rules encoded in a smart
contract
Fungible - Answer-All tokens are equivalent
Non-fungible - Answer-Tokens are unique
Asset tokens - Answer-Backed by another asset (i.e. gold or digital artwork)
Payment tokens - Answer-Coins
Security tokens - Answer-Play a similar role to traditional equity, issued through initial
coin offerings (ICO)
Utility tokens - Answer-Gives access to product or service
Governance tokens - Answer-Allows stakeholders to collaborate (and vote)
Reward tokens - Answer-Awards benefits, granted in reward for participation
Smart contracts - Answer-Algorithms that automatically execute on the blockchain;
essential for tokenization
Digital object identifiers - Answer-ID for internet objects
,Universal object identifier - Answer-ID for all digital and physical objects
Distributed storage - Answer-Breaking down large files and storing across networks
(interplanetary file system)
Distributed ledger technology - Answer-Database shared and synchronized across
multiple locations (blockchain is an example of DLT)
Relayers - Answer-Off-chain managers of the order book
Off-chain collateral - Answer-Storing collateral assets with an escrow service like a
commercial bank
On-chain collateral - Answer-The assets are locked on the blockchain within smart
contracts
Scalability - Answer-The risk that a blockchain will not be able to meet increased
demands for more block space without compromising advantages such as
decentralization and security
Oracles - Answer-Off-chain parties that provide prices or information into a
decentralized blockchain system
Initial coin offering (ICO) - Answer-Cryptocurrency version of an IPO; they are issued on
the blockchain, and they have drawn considerable regulatory interest
Initial exchange offering (IEO) - Answer-ICO administered by cryptocurrency exchange
(underwriters); effectively an ICO that opens on a centralized exchange rather than on
the blockchain
Security token offering (STO) - Answer-Tokenized digital securities sold on security
token exchanges; attempt to resolve regulatory issues with ICOs by involving ownership
rights in the company issuing an ICO
Utility token offering (UTO) - Answer-Issuing the right to participate in a digital
application or service; encourages usage of digital assets. It gives the owner the right to
participate in an activity or service within a digital ecosystem.
DeFi RegTech - Answer-Deploying DeFi technologies to allow regulators to collaborate
Value creation plan (VCP) - Answer-Combination of action items identified by private
equity firms for implementation on investment ('deals') to enhance value
Fiat off-ramp - Answer-Moves assets from a blockchain-based system to a bank
account
, The settlement layer - Answer-Considered Layer 1 and contains both the blockchain
itself and the native protocol asset
The asset layer - Answer-Considered Layer 2 and includes all assets listed on the
blockchain (the native protocol asset and any others
Whipsawed - Answer-Selling based on falling prices only to see the market recover or
buying based on rising prices only to see the market weaken
Net promoter ranking - Answer-A measurement used to capture the culture metric within
the category of environmental enablers
Measurements - Answer-Represent observable facts
Metrics - Answer-Measurements put into broader context, can represent knowledge
Asset owners - Answer-Acting in a fiduciary capacity for the principal (I.e. pension
funds, endowments, family offices)
Principal - Answer-Ultimate owner of the assets; could refer to an individual, beneficiary,
or institution acting on behalf of the individual
Agents - Answer-Provide services to asset owners to enhance value (i.e. asset
managers, investment banks, consultants)
Stakeholders - Answer-Those directly and indirectly affected by industry (i.e.
governments, regulators, academics)
Social license principal - Answer-Society implicitly grants a license to carry out
commercial business when it enhances social well-being; companies that engage in
sustainable finance will be granted a clean social license to operate
Stewardship - Answer-Engagement with investee companies to promote long-term
growth (fundamental purpose)
Sustainability - Answer-Meeting current asset owner needs while not harmful interests
of future stakeholders
Access persons - Answer-Employees of a U.S. investment adviser with access to
nonpublic information regarding securities transitions
Fundamental purpose - Answer-Increase societal wealth and well-being
Intrinsic purpose - Answer-Matching those with excess capital with those that have a
capital need (the plumbing)
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller biggdreamer. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $17.49. You're not tied to anything after your purchase.
Can Stuvia be trusted?
4.6 stars on Google & Trustpilot (+1000 reviews)
80796 documents were sold in the last 30 days
Founded in 2010, the go-to place to buy study notes for 14 years now