Blockchain Developer Interview Questions

1. What is Blockchain?
Answer: Blockchain is a cardinal ledger of financial transactions that is programmed to record transactions but and virtually everything of value. The Blockchain technology was discovered along with the innovation of Bitcoins. As because everything is safe and secure in Bitcoin, it will simply run for a long time.

2. Why are blockchains relevant to certification and assurance organizations?
We believe that the unique value in certification and assurance organizations lies in the trusted data that only they can provide. By adopting blockchain technology as a way to outsource the proving of that data to public blockchains, those organizations can benefit in several ways, including:

  • Reduction in system operation costs
  • Transparency along the supply chains they focus on
  • Credibility to regulators and the public
  • Inclusiveness of smaller sized actors of supply chains

3. When talking about a “transaction”, does any action on a blockchain represent a transfer of value?
No. In the context of blockchains, the word “transaction” is much more general than a transfer of value. It is used to describe any interaction of a user with the system. For example, a certifier would make a transaction to deliver a certificate. Some transactions do represent a transfer of value.

4. What are the threads to the information you are familiar with?
There are lots of threats to information in the present scenario. Due to the increase in online transactions over the internet, many hackers have become active and are adopting new approaches to hack information and servers that contain financial information. The major threat is software attack, identity theft, information extortion, as well as sabotage. In addition to this, Trojan horses, worms, and viruses are other trouble creators.

5. What is information processing according to you? What are the key challenges that are associated with it?
The information is often shared on a network. Before actually transmitting it over a network, it needs to be changed into formats that can fit the standards of the channels (channel is a link between the sender and a receiver). The work done to convert the information at both the sender and receiver end is generally regarded as information processing. The biggest challenge to information processing is securing it during that time. Another challenge is processing bulk information that can impose a limit on performance. 

6. What is the principle of Blockchain Technology?
It allows the information to be distributed among the users while not being traced.

7. What are the advantages of Blockchain that you simply know?

There are plenty of benefits for Blockchain:

  • Settlement in real-time
  • Cost-saving
  • Immutability
  • Security
  • User Pseudonymity

8. Is it true that a block in the blockchain can never have more than one parent block?
Yes, indeed, Blockchain can never have a parent Block. Each and each block is independent in Blockchain

9. What is the difference between Wei and Ether?
Wei is a denomination, like cents to Dollars or pennies to Pounds. 1 ETH = 1⁰¹⁸ Wei

10. What are some ways to interact with a network?

You can either use a Wallet or a DApp

11. Which RPCs can you use to connect to a geth client over the network?
You can connect to a geth client over the network using JSON-RPC and WS-RPC. IPC-RPC can only connect to geth clients on the same machine.

12. What is mining?
Mining is the process of reaching consensus in blockchain networks. Mining serves two purposes. First, it creates new coins in a generated block. Second, it includes transactions in a distributed ledger by providing proof of work to the network; that is, proof that the generated block is valid. 

13. How does peer discovery work in a peer-to-peer (P2P) network?
When new node boots up, it doesn’t know anything about the network, because there is no central server. Usually, developers provide a list of trusted nodes written directly into the code that can be used for initial peer discovery.

14. Explain the difference between blockchain ledger and a standard one?
The first and of course the prime distinction is Blockchain is a digital ledger that will be decentralized simply. The chances of error during this method are way under that in a standard ledger. A normal ledger is that which is ready by hands whereas the Blockchain performs all its tasks mechanically. You simply have to be compelled to assemble it in an exceedingly correct manner and by following all the rules.

15. What is a more in-depth definition of a miner??
Someone who’s willing to take part in a public blockchain’s distributed consensus. The way they do this is by buying virtual lottery tickets. The more tickets they buy, the more likely they will win the lottery, which picks a winner and resets every 10 minutes.

16. When talking about “verifying” a transaction, what are miners verifying? Do they look at the transaction manually?
No. In the context of blockchains, the word “verify” has a different meaning than what you are used to in a certification context. It does not involve checking documents or identities. The only thing miners care about is for the transaction to be valid according to the rules of the blockchain. On Bitcoin, the only thing they would check is that a transaction does not “double-spend” a coin. This does not require human scrutiny.

17. What guarantees that a supply chain transaction is “valid” if there is no one checking that the delivered mass equals what the system says?
In general, nothing. A blockchain can only enforce the rules that can be understood by a computer. A blockchain is more useful to enforce rules on the information inside the system (e.g prevent double-spending) than controlling what information enters the system (e.g linking digital products to physical products).

18. How do they differ from public blockchains?
In terms of trust, private blockchains stand between centralized systems and public blockchains. (Blockchain Training) One actor can usually not take control of the system, but a small set of colluding validators could. Private blockchains are closer to centralized systems when it comes to scalability and privacy, as they do not have the same transparency and openness requirements as public blockchains. In the same way, they are closer to centralized systems when it comes to lack of interoperability, as they can still be considered as data silos.

19. What is the principle on which blockchain technology is based on?
It enables the information to be distributed among the users without being copied.

20. What is Metamask?
Metamask is a tool which helps you to easily interact with the Ethereum networks in your browser

21. What does the EVM need to run a Smart Contract?
It needs the contract’s bytecode which is generated from compiling a higher-level language such as Solidity.

22. What are the 2 types of records that are present within the Blockchain Database?

The two types of records are:

  • Block records
  • Transactional records

Both these records will be and retrieved and integrate them with another while not following the difficult algorithms

23. Lottery tickets? Really?
Under the hood, miners all run the same special program on their computer. It requires a lot of resources, which impacts their electricity bill. This program does something similar to trying to crack a password. Miners with more powerful computers will be able to make more tries each second, so are more likely to find the solution. They will also need to spend more money on electricity. When a miner finds the solution, she gets a reward, 12.5 bitcoin on the Bitcoin blockchain, and the process starts over. 

24. So on a blockchain, auditors cannot verify transactions?
They can. First, they have access to a certain level of transparency about the transactions that are being submitted to the network by the supply chain actors. Then, depending on the use case, the rules of the system could also give auditing bodies power in the system itself. For example, a certifier could be enabled to stop a producer from issuing more digital assets that carry a certification if audits have failed.

25. What are private blockchains?
Private (or consortium) blockchains are blockchains on which the consensus is not determined by an open community of anonymous, financially incentivized validators (the miners) but rather by a small, closed set of actors that have some interest in sharing data and processes. For example, a consortium of banks or actors in a supply chain. 

26. What does Blockchain do?
Blockchain is, quite simply, a digital, decentralized ledger that keeps a record of all transactions that take place across a peer-to-peer network.

27. What are confirmations on the Blockchain?
Bitcoin Confirmations. Roughly every ten minutes, a new block is created and added to the blockchain through the mining process. This block verifies and records any new transactions. The transactions are then said to have been confirmed by the Bitcoin network. 

28. What are Smart Contracts?
Smart contracts help you exchange money, property, shares, or anything of value in a transparent, conflict-free way while avoiding the services of a middleman.

29. What are the different types of records in Blockchain technology?

There are two different types of records available in Blockchain, they are,

  • Block Records
  • Transactional Records

30. So what is hashing?
In simple terms, hashing means taking an input string of any length and giving out an output of a fixed length. In the context of cryptocurrencies like Bitcoin, the transactions are taken as input and run through a hashing algorithm (Bitcoin uses SHA-256) which gives an output of a fixed length.

31. What is a block in blockchain technology?
Blocks are the storage unit of the blockchain. They are fundamental to the network, and the transactions data is stored within them. They can be seen as books with each page equivalent to a transaction. Blocks are immutable. This means if a data is recorded, it can not be changed or deleted. Also, blocks are organized linearly in a blockchain.

A block is mined by a miner which acts as a way to verify the transaction. This means that until a transaction is not mined, it will not be shown on the blockchain and the transaction will be deemed incomplete.

Note: The question is very common in blockchain job interviews

32. What are the types of blockchain?

Explain the types, in short, There are three types of blockchain.

Private: Private blockchain works in a closed ecosystem and is set to permissioned. This means that no outsider can join or know the activities within the private blockchain.

Public: Public blockchain works in an open ecosystem where anyone can join and do transactions.

Consortium: Consortium blockchain is semi-decentralized.

33. What is a cryptocurrency?
Cryptocurrency is a digital currency that works without any centralized control. Cryptocurrency powers a lot of blockchain networks out there. They are also known as virtual currencies and differ from the likes of fiat currencies. For example, Bitcoin, Ethereum, and Litecoin are an example of cryptocurrencies.

34. How secure is blockchain? Have they even be hacked?
The blockchain is comparatively secure when compared to other similar technologies right now. However, they are not completely secure as it is vulnerable to a 51% attack. A 51% attack is a way by which a group of miners or organization gains access to the more than 50% of the networking computer power. Once done, they can easily take control and alter transactions in the network which can lead to asset theft and data alteration.

Blockchain platforms are also prone to another form of human errors. The most prominent example is the ETC-ETH fork that happened because a coder deleted some ethereum smart contract code which leads to ETH lock. It became inaccessible which lead to a hard fork in the blockchain.

The 51% attack is theoretically possible but is hardly carried out in the real world as it would require huge computational processing power. (Company)

35. What are the two types of records that Blockchain database support?
Blockchain database supports transactional and “block” record. Both the records can be accessed without any issues.

36. What is the difference between the standard ledger and a blockchain ledger?
The biggest difference between these two types of the ledger is the decentralization that they have to offer. The blockchain ledger is decentralized which means that it offers unique capabilities such as trust, immutability, transparency, and security. Standard ledger does carry these features but is limited to a certain extent.

37. What are the key elements of the blockchain ecosystem? Explain each of them briefly?

The blockchain has four key elements. They are as follows.

  • Shared ledger
  • Node application
  • Virtual Machine
  • Consensus Algorithm

Shared Ledger: the Shared ledger is the logical component of a blockchain. It is decentralized in nature.

Node Application: A node application is a software/solution that lets a computer connect with the blockchain. For example, Bitcoin uses a Bitcoin wallet application to identify each node on the network.

Virtual Machine: The virtual machine handles all the tasks that a blockchain undertakes. It is part of the node application and provides an environment where instructions can run.

Consensus Algorithm: The Consensus algorithm is used to set the blockchain rules by which every node can come to a conclusion. There are different consensus algorithm used in the blockchain.

38. What is a Virtual Machine? Explain in detail?
Virtual Machine runs as a part of a node computer. It is a virtual state of a machine that mimics a real machine. It is imaginary and provides certain functionalities in a pre-defined state. The virtual machine also works and doesn’t have to rely on the host computer or machine. The key point here is abstraction which is used to provide an operating environment for an application or service to work.

All the blockchain have their virtual machine. They are designed and work differently. For example, the VM used by Bitcoin and Ethereum is different. Ethereum virtual machine is also more advanced than of Bitcoin. It can stay on an Ethereum node and interact with smart contracts.

39. Can RSA be attacked? If so, how?
Yes, hackers can attack RSA. However, being attacked is not equal to weak protection. It is just the methods that can be used to attack it and take a chance to break it. There are two ways, one can attack RSA, i.e., brutal force and mathematical attacks

40. Explain a real-time blockchain use case?
Healthcare can use blockchain to their advantage. Many startups are currently working on a blockchain-powered health app that lets patients store their information on the blockchain. The decentralized nature means that they don’t have to carry documents. Healthcare specialists can also take advantage of it as they can access the patient’s data anytime they want. Researchers also benefit from public blockchain where they can access large public data.

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