Blockchain Final Questions And Well Elaborated Answers || Ace The Test
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Course
Blockchain
Institution
Blockchain
Who created the first crypto? - Correct Answer Satoshi Nakamoto, the creator of bitcoin.
What is blockchain? - Correct Answer A blockchain is a digital ledger (a shared database) that stores data in blocks linked together via cryptography. Many different types of information can be stored in...
Blockchain Final Questions And Well Elaborated Answers ||
Ace The Test
Who created the first crypto? - Correct Answer Satoshi Nakamoto, the creator of bitcoin.
What is blockchain? - Correct Answer A blockchain is a digital ledger (a shared database) that stores
data in blocks linked together via cryptography. Many different types of information can be stored in
blockchains, the most common being to track transactions.
Decentralized blockchains (bitcoin) are immutable, every transaction is recorded and can be viewed by
anyone.
What are the four components of blockchain - Correct Answer Nodes (forms structure of the network),
for example a miner and a validator
Distributed ledger, the database of the blockchain, the ledger is blocks that are linked using the previous
block's hash
Assets, example of this would be transactions, code blocks (smart contracts), medical records
Consensus Algorithm, example would be Proof of Work/Stake, it is used to add transactions to the
ledger, otherwise discarded.
Virtual Machine, Ethereum runs virtual machines on nodes to execute smart contracts to prevent
malware attacks (added security)
State Database, a key value database that represents state of network to save time during transactions
Explain Proof of work - Correct Answer A consensus algorithm/mechanism that requires network
members to solve an encrypted hexadecimal number, also known as mining for bitcoin. Proof of work
allows for secure p2p transactions without needing a 3rd party, as well as requiring a lot of energy.
Miners collect new transactions that got broadcasted onto the network
, A new block is created with previous block info, timestamp, and a nonce
Computing power is used to find a hash for the block (mining)
Once a hash is found, the block is broadcasted onto the network with other nodes verifying it before
adding it to the blockchain
The miner who mined the block is rewarded with BTC
Process starts over
List three uses of blockchain in financial system - Correct Answer Use in capital markets *crypto,
decentralized currency so there is not a single point of failure
Cheap and fast global payments, rapid and secure cross border payments without the fees (10 minutes
instead of a 2-7 days)
Property and claim insurance, documents can be stored on blockchain and prevent identity theft,
automatic claims processing using smart contracts
Turn assets into tokens, creating digital tokens that represent real world assets
Difference between private and public blockchain. List one example. - Correct Answer A public
blockchain (bitcoin) is open to anyone and not controlled, anyone can participate in the network,
validate transactions and create new blocks.
A private blockchain participant may be pre selected or only be viewable to a small group of people
(think of read write access for a single org)
Difference is that public blockchains use a lot of energy while private blockchains are more energy
efficient and faster
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