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I haven't heard of Cloudflare doing that, but it's the concept behind mCaptcha: https://mcaptcha.org/

Effectively yes. Not mining bitcoin, but modern bot detection works by asking your browser to do various tasks and comparing the results to a known good sample.

It could be a complex math problem, or another common trick is to purposely trigger bugs like a javascript engine not rounding numbers correctly in edge cases.

Not sure if cloudflares does it but disable WASM/JavaScript and you’ll find some that do.