Understanding Blockchain Technology

What is a blockchain?

• A blockchain is a centralized database managed by a single entity.

• A blockchain is a physical ledger used for accounting.

• A blockchain is a decentralized digital ledger that records transactions in a secure and immutable way.

• A blockchain is a type of cryptocurrency.

Which of the following is a key feature of blockchain?

• Decentralization

• Immutability

• Centralization

• Transparency

What does the term 'decentralization' mean in blockchain?

• Decentralization is about limiting the number of participants in a network.

• Decentralization refers to the process of increasing transaction fees.

• Centralization means having a single authority control all transactions.

• Decentralization means distributing control across a network, allowing multiple participants to validate transactions without a central authority.

What is a smart contract?

• A smart contract is a legal agreement that requires notarization.

• A smart contract is a type of insurance policy.

• A smart contract is a physical document signed by both parties.

• A smart contract is a self-executing contract with the terms written into code on a blockchain.

Which cryptocurrency was the first to use blockchain technology?

• Ripple

• Ethereum

• Bitcoin

• Litecoin

What is the role of miners in a blockchain network?

• Miners only store data without any validation.

• Miners create new cryptocurrencies from scratch.

• Miners are responsible for user account management.

• Miners validate transactions and add new blocks to the blockchain.

What does 'hashing' refer to in the context of blockchain?

• Hashing is the process of encrypting data for secure transmission.

• Hashing is the process of converting data into a fixed-size hash value for integrity and security in blockchain.

• Hashing refers to the method of storing data in a database.

• Hashing is the technique used to compress files for faster access.

What is a public key in blockchain?

• A public key is a type of digital currency in blockchain.

• A public key is a cryptographic key used to receive transactions in blockchain.

• A public key is used to encrypt transactions in blockchain.

• A public key is a unique identifier for a blockchain user.

What is the difference between public and private blockchains?

• Public blockchains are open and decentralized, while private blockchains are restricted and controlled.

• Public blockchains are controlled by a single entity.

• Private blockchains are accessible to everyone without restrictions.

• Public blockchains are always faster than private blockchains.

What is a consensus mechanism?

• A consensus mechanism is a protocol that ensures agreement on a single data value among distributed systems.

• A consensus mechanism is a type of database management system.

• A consensus mechanism is a method for data encryption.

• A consensus mechanism is a hardware component for network security.