Blockchain 2

What cryptographic concept is fundamental to the security of cryptocurrencies like Bitcoin?

• Symmetric encryption
• Public-key cryptography
• Hash functions
• Steganography

Which consensus mechanism is used by Bitcoin to validate transactions and secure the network?

• Proof of Work (PoW)
• Proof of Stake (PoS)
• Delegated Proof of Stake (DPoS)
• Practical Byzantine Fault Tolerance (PBFT)

What is the purpose of a "nonce" in the context of cryptocurrency mining?

• To serve as a unique identifier for each transaction.
• To verify the authenticity of the transaction sender.
• To adjust the difficulty of the mining process.
• To find a valid hash that meets the target criteria

What role do miners play in the cryptocurrency ecosystem?

• Storing encrypted data on the blockchain.
• Validating transactions and adding them to the blockchain.
• Generating public and private keys for wallet addresses.
• Auditing the blockchain for security vulnerabilities.

What is the purpose of the "coinbase transaction" in a block of the Bitcoin blockchain?

• To reward the miner who successfully mined the block.
• To facilitate cross-border payments using Bitcoin.
• To verify the integrity of the previous block.
• To encrypt the transactions stored in the block.

How does the Lightning Network aim to improve scalability in Bitcoin and other blockchain networks?

• By increasing the block size to accommodate more transactions.
• By introducing sharding to partition the blockchain into smaller segments.
• By moving certain transactions off-chain to reduce congestion on the main blockchain.
• By implementing a new consensus mechanism based on proof of stake.

What is the primary function of a cryptocurrency wallet?

• To mine new coins and validate transactions on the blockchain.
• To securely store private keys and manage cryptocurrency holdings.
• To facilitate peer-to-peer communication between nodes on the blockchain.
• To encrypt sensitive data stored on the blockchain.

How does a hardware wallet differ from a software wallet in the context of cryptocurrency storage?

• Hardware wallets are stored in the cloud, while software wallets are stored locally on a device.
• Hardware wallets require an internet connection to access funds, while software wallets do not.
• Hardware wallets store private keys offline on a physical device, providing enhanced security.
• Hardware wallets offer more advanced features and functionalities compared to software wallets

What is the purpose of a "whitepaper" in the context of cryptocurrency projects?

• To provide a technical specification and implementation details of the cryptocurrency protocol.
• To outline the marketing strategy and target audience for the cryptocurrency.
• To summarize the financial performance and revenue projections of the cryptocurrency.
• To showcase the team members and their qualifications for developing the cryptocurrency.

Which of the following best describes the primary characteristic of decentralized applications (dApps)?

• Operate on centralized servers controlled by a single entity.
• Rely on consensus mechanisms for transaction validation and execution.
• Require permission from a central authority to access and use.
• Utilize traditional web technologies and architectures.