General Blockchain Questions & Answers

Reference: www.edureka.co, Wrote by Shashank, January 2019

Edited for LinkedIn by Ali Soofastaei, (www.soofastaei.net)

Q 1. What do you know about Blockchain? What is the difference between Bitcoin blockchain and Ethereum blockchain?

The blockchain is a decentralized distributed database of immutable records. The technology was discovered with the invention of Bitcoins (the first cryptocurrency). It’s a trusted approach, and there are a lot of companies in the present scenario which are using it. As everything is secure, and because it’s an open source approach, it can easily be trusted in the long run.

Q 2. What is the principle on which blockchain technology is based on?

It enables the information to be distributed among the users without being copied.

 Q 3. What are the different types of Blockchains?

Blockchains are of three types: 

Q 4. Why is Blockchain a trusted approach?

Blockchain can be trusted due to so many reasons.

It's compatibility with other business applications due to its open-source nature.

It's security. As it was meant for online transactions, the developers have paid special attention to keeping up the pace when it comes to its security.

It really doesn’t matter what type of business one owns; Blockchain can easily be considered.

 Q 5. Name the two types of records that are present in the blockchain database?

These records are block records and transactional records. Both these records can easily be accessed, and the best thing is, it is possible to integrate them with each other without following the complex algorithms.

Q 6. The blockchain is a distributed database. How does it differ from traditional databases?

Q 7. What are the properties of Blockchain?

There are four key features of blockchain:

·        Decentralized Systems

·        Distributed ledger

·        Safer & Secure Ecosystem

·        Minting

Q 8. What is encryption? What is its role in Blockchain?

Data security always matters. Encryption is basically an approach that helps organizations to keep their data secure. The encrypted data is encoded or changed up to some extent before it is sent out of a network by the sender and only authorized parties can access that information. In Blockchain, this approach is useful because it simply adds more to the overall security and authenticity of blocks and helps to keep them secure.

Q 9. What do you mean by blocks in the blockchain technology?

Blockchain consists of a list of records. Such records are stored in blocks. These blocks are in turn linked with other blocks and hence constitute a chain called Blockchain.

Q 10. How does a block is recognized in the Blockchain approach?

Every block in this online ledger basically consists of a hash pointer which acts as a link to the block which is prior to it, transaction data and in fact a stamp of time.

 Q 11. Is it possible to modify the data once it is written in a block?

No, it’s not possible to do so. In case any modification is required, the organization simply has to erase the information from all other blocks too. It is because of no other reason than this; data must be given the extreme care of while using this approach.

 Q 12. What are Block Identifiers?

In Blockchain, blocks can be identified by the block header hash and the block height.

 Q 13. Is it possible in Blockchain to remove one or more block from the networks?

Yes, it can be done. There are times when only a specific portion of this online ledger is to be considered. With the help of default options and filters, this can easily be done without making a lot of efforts.

 Q 14. What exactly do you know about the security of a block?

Well, a block or the entire blockchain is protected by a strong cryptographic hash algorithm. Each block has a unique hash pointer. Any modification in the block constituents will result in the change in the hash identifier of the block. Therefore, it offers an excellent level of security. Thus, one needs not to worry about safety as well as the security of data that is present in a block.

 Q 15. What are Merkle trees? How important are Merkle trees in Blockchains?

Merkle Tree also is known as ‘hash tree’ is a data structure in cryptography in which each leaf node is a hash of a block of data, and each non-leaf node is a hash of its child nodes.

The benefit of using the Merkle Tree in blockchain is that instead of downloading every transaction and every block, a “light client” can only download the chain of block headers.

Also, if someone needs to verify the existence of a specific transaction in a block, then he doesn’t have to download the entire block. Downloading a set of a branch of this tree which contains this transaction is enough. We check the hashes which are just going up the branch (relevant to my transaction). If these hashes check out good, then we know that this particular transaction exists in this block.

Q 16. What is a ledger? Is Blockchain an incorruptible ledger?

The blockchain is considered incorruptible. Any ill-intentioned individual acting alone is powerless. “To take over the network, an attacker would have to control more than 50 percent of its total computing power,” Augier explains. “We hope that’s a theoretical scenario, but we can’t be sure. Should it happen, the individual would take every precaution to avoid being noticed.” Not to mention the energy required to power the computers needed for the blockchain system to work.

Q 17. Name the common type of ledgers that can be considered by users in Blockchain?

These are:

Q 18. How is a blockchain ledger different from an ordinary one?

The first and in fact the prime difference is Blockchain is a digital ledger that can be decentralized very easily. The chances of error in this approach are far less than that in an ordinary ledger. An ordinary ledger is what that is prepared by hands or by human efforts while the Blockchain performs all its tasks automatically. You just need to configure it in a proper manner and by following all the guidelines.

Q 19. What type of records can be kept in a Blockchain? Is there any restriction on the same?

There is no restriction on keeping records of any type in the Blockchain approach. Industries are using Blockchain for securing all types of records.

 The common types of records (to name a few) that can be kept on the Blockchains are:

·        Records of medical transactions

·        Identity management

·        Transaction processing

·        Business transactions,

·        Management activities

·        Documentation

Q 20. A distributed digital ledger is used for recording transaction in Blockchain. What does the system rely on?

The system relies on the network servicing protocol and the nodes of the network.

 Q 21. Can You explain the components of the Blockchain Ecosystem?

Following are the components of a blockchain Ecosystem:

Q 22. State difference between proof-of-work & proof-of-stake?

                              Proof-of-work vs. proof-of-stake

Q 23. Name some popular platforms for developing blockchain applications

After the development of bitcoin, various blockchain platforms started coming up. Ethereum came right after the evolution of Bitcoins and is one of the popular public platforms for building Blockchain based applications.

Then there is a Hyperledger community for building enterprise-based solutions. Also, Qtum, IOTA, EOS are some of the widely used platforms for building Blockchain.

 Q 24. What is Double Spending? Is it possible to double spend in a Blockchain system?

It’s a condition when one digital token is spent multiple times because the token generally consists of a digital file that can easily be cloned. It simply leads to inflation and organizations must bear a huge loss. One of the primary aims of Blockchain technology is to eliminate this approach up to the possible extent.

Blockchain prevents double spending by confirming a transaction by multiple parties before the actual transaction is written to the ledger. It’s no exaggeration to say that the entirety of bitcoin’s system of Blockchain, mining, proof of work, difficulty, etc, exist to produce this history of transactions that is computationally impractical to modify.

Q 25. What are the benefits of Blockchain that you know?