1. What do you mean by blocks in the blockchain technology?
Answer: Blockchain consists of information of all the financial transactions. A block is nothing but just a list of records. When these lists are combined with each other, they are known as the blockchain. For example- an organization has 100 ledger books the combination of which is known as Blockchain and a single ledger would be considered as a block.
2. What is encryption? What is its role in Blockchain?
Answer: Data security always matters. Encryption is basically an approach that helps organizations to keep their data secure.cryptography-top blockchain interview questions 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.
3. What is a ledger? Is Blockchain an incorruptible ledger?
Answer: 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.
4. Explain about Public Blockchains?
Answer: A public blockchain has absolutely no access restrictions. Anyone with an internet connection can send transactions to it as well as become a validator
5. What is a security policy?
Answer: A security policy defines what exactly needs to be secured on a system. It bounds a network user under some core protocols that they all must agree and follow to enhance the overall security. When it comes to information or financial records of an organization, multiple security policies are implemented than just one.
6. What are Blockchain Durability and robustness?
Answer: Blockchain technology is like the internet in that it has a built-in robustness. By storing blocks of information that are identical across its network, the blockchain cannot:
1. Be controlled by any single entity.
2. Has no single point of failure.
Bitcoin was invented in 2008. Since that time, the Bitcoin blockchain has operated without significant disruption. (To date, any of the problems associated with Bitcoin have been due to hacking or mismanagement. In other words, these problems come from bad intention and human error, not flaws in the underlying concepts.)
The internet itself has proven to be durable for almost 30 years. It’s a track record that bodes well for blockchain technology as it continues to be developed
7. What are the business benefits of blockchain?
Answer: Blockchain consensus mechanisms provide the benefits of a consolidated, consistent dataset with reduced errors, near-real-time reference data, and the flexibility for participants to change the descriptions of the assets they own.
Because no one participating member owns the source of origin for the information contained in the shared ledger, blockchain technologies lead to increased trust and integrity in the flow of transaction information among the participating members.
Immutability mechanisms of blockchain technologies lead to lowered cost of the audit and regulatory compliance with improved transparency. And because contracts being executed on business networks using blockchain technologies are smart, automated, and final, businesses benefit from increased speed of execution, reduced costs, and less risk, all of which enables businesses to build new revenue streams to interact with clients.
8. Why is Blockchain a trustworthy approach?
Answer: Blockchain can be trustworthy thanks to such a large amount of reasons.
Its compatibility with different business applications thanks to its open-source nature.
Blockchain security. Because it was meant for online transactions, the developers have paid special attention to maintaining the pace once it involves its security. It extremely doesn’t matter what style of business one owns, Blockchain will simply be thought of.
9. What exactly does one comprehend the security of a block?
Answer: Well, a block or the complete blockchain is protected by a powerful cryptographic hash algorithm. Every block includes a distinctive hash pointer. Any modification within the block constituents will lead to the modification within the hash identifier of the block. Therefore, it offers a wonderful level of security. Thus, one needs to not worry regarding the protection additionally because of the security of knowing that’s a gift in an exceedingly block.
10. What type of records is kept in a Blockchain? Is there any restriction on the same?
Answer: There is no restriction on keeping records of any sort within the Blockchain approach. Industries are using Blockchain for securing all kinds of records.
The common kinds of records (to name a few) which will be unbroken on the Blockchains are:
- Records of medical transactions
- Identity management
- Transaction process
- Business transactions,
- Management activities
11. What are the most promising industries to be transformed by blockchain?
Answer: In my point of view, all that is related to social impact will greatly benefit from it. Blockchain finally provides a unique way to measure what was thought of as difficult to measure. This will lead to tremendous opportunities in the time to come.
12. What is Transparent and incorruptible in blockchain?
Answer: The blockchain network lives in a state of consensus, one that automatically checks in with itself every ten minutes. A kind of self-auditing ecosystem of a digital value, the network reconciles every transaction that happens in ten-minute intervals. Each group of these transactions is referred to as a “block”. Two important properties result from this:
Transparency data is embedded within the network as a whole, by definition it is public. It cannot be corrupted altering any unit of information on the blockchain would mean using a huge amount of computing power to override the entire network.
13. What are the Merkle trees? How important are Merkle trees in Blockchains?
Answer: Merkle Tree is also known as the ‘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 the 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 that 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.
14. What is Double Spending? Is it possible to double spend in a Blockchain system?
Answer: 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, exists to produce this history of transactions that is computationally impractical to modify.
15. Are there any network-specific conditions for using Blockchain technology in an organization?
Answer: There is no specific condition on using it. However, the network must be a peer-to-peer network under the concerned protocols. It actually validates the new block simply and helps organizations to keep up the pace in this matter without investing in third-party applications.
16. Explain the significance of a blind signature and how it is useful?
Answer: Blind signature is actually a form of digital signature and is a very important part of the cryptography in which all the information is made blind before it is actually signed. This is a verified approach and is mainly considered in the privacy-related protocols where both the author and the signing parties are different.
17. What are the features of Blockchain?
The key features of blockchain are,
Distributed Database: Information stored on a blockchain exists as a shared and continually reconciled database.
Decentralized Systems: Decentralized systems enable users to store their assets in a network that can be accessed over the Internet.
Distributed Ledger: It provides information about all the digital transactions and the users who have done the digital transactions ever.
Safer and Secure Ecosystem: Due to its incorruptible digital ledger of economic transactions that can be programmed to record digital transactions provides a safer and secure ecosystem
18. What is a block in Blockchain?
Answer: Blocks hold batches of valid transactions that are hashed and encoded into a Merkle tree. Each block includes the cryptographic hash of the prior block in the blockchain, linking the two. The linked blocks form a chain. This iterative process confirms the integrity of the previous block, all the way back to the original genesis block.
19. What is the Merkle root?
Answer: Every transaction has a hash associated with it. In a block, all of the transaction hashes in the block are themselves hashed (sometimes several times — the exact process is complex), and the result is the Merkle root. In other words, the Merkle root is the hash of all the hashes of all the transactions in the block. The Merkle root is a part of the block header.
With this scheme, it is possible to securely verify that a transaction has been accepted by the network (and get the number of confirmations) by downloading just the small block headers and Merkle tree – downloading the entire blockchain is unnecessary.
20. What do you understand by blockchain?
Answer: The blockchain is a redistributed distributed database of immutable records. The technology was discovered with the invention of Bitcoins (the 1st cryptocurrency). It’s a trusty approach and there are heaps of firms within the present situation that are using it. As everything is secure, and since it’s Associate in Nursing open supply approach, it will simply be sure in the long run.
21. What are the various approaches employed in attacking the RSA algorithm?
There square measure totally different approaches employed in assaultive the RSA algorithm:
Brute force: It involves all potential secret keys
Mathematical attacks: In mathematical attack, we tend to square measure mistreatment totally different techniques, that is analogous in the effort to issue the merchandise of 2 primes.
22. What precisely does one know about executive accounting? Does Blockchain support the same?
Answer: Executive accounting is nothing, however, a special form of accounting that is intended solely for a business that provides services to the individuals. There’s no strict higher limit on services and business will manage any through the management accounting. Blockchain has algorithms that are specially meant to handle government accounting. In fact, it cut down several issues that are related to the same.
23. How mining in Ethereum works?
Answer: As of the beginning of 2018, it uses Proof of work but it is going to switch to Proof of stake.
In Proof-Of-Activity, an alternative incentive structure introduced in bitcoins which is the hybrid structure that combines both Proof-Of-Work and Proof-Of-Stake. To avoid hyperinflation we have to stop the mining incentives because there are no more coins left in the system. An only limited number of coins are present in some system like bitcoins. In proof-of-activity, before all the coins used Proof-Of-Work in the picture and as soon as coins finish Proof-Of-Stake start working in which fees are divided between miners and validators who signed off the block.
24. In blockchain technology, what does the word “blocks” stand for?
Answer: Blockchain consists of information of all the financial transactions. By a block, we refer to a list of records. When these various lists are combined with each other, they are known as the blockchain. For example- an organization has 100 ledger books. Here each and every ledger book is considered a block and the combination of these is known as a Blockchain.
25. How a blockchain ledger is different from an ordinary one?
Answer: 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 with 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.
26. How does the security of a block works?
Answer: A block is the most secure part of a blockchain. A cryptographic hash algorithm protects it. The block also consists of a distinctive hash pointer which adds more security to the block. If the value within a block is changed, the hash value will also change. This is a security identifier and provides a reasonable level of security to the whole blockchain. Also, hackers need to know the hash key of the previous block even to attempt to make changes to the block information.
27. What is Consensus Algorithm?
Answer: The consensus algorithm is also a part of node application. It is used to reach a consensus in the ecosystem. There is no single way to achieve consensus, and that’s why different blockchain environment uses different consensus methods. Bitcoin, for example, uses Proof-of-Work(PoW) consensus algorithm.
The nodes that participate in the blockchain has to use consensus algorithm.
28. Can you share the names of platforms are that are actively developing Blockchain apps?
Answer: There are many organizations or platforms that are actively improving the blockchain ecosystem. Hyperledger community is one of the leading open source platforms that is working towards developing enterprise-grade blockchain solution.
The Ethereum platform is also active in blockchain app development. They do differ in their approach. Ethereum provides developers, organizations, and businesses to create blockchain apps, whereas Hyperledger is creating tools, techniques and other methods to empower the different blockchains. (Company)
29. What are the benefits of blockchain? Explain it from your viewpoint and understanding?
Answer: Blockchain has many benefits. First of all, it provides instant and secure online transactions. It also uses a decentralized ledger system that provides transparency and verifiability to new heights. It also means that no one can alter the data.
Overall, the use of blockchain further improves the security and ensure that the business doesn’t have to spend too much money on making their security strong. Blockchain also enables business and startups to reach a global audience without worrying about geographical restrictions. Currently, it is breeding innovation in almost every sector out there.
30. Will blockchain change the world?
Answer: The blockchain is going to revolutionize our daily life. It has the potential to change how we spend and transact. Also, it is already changing various sectors such as transport, education, business, and so on. As it allows a peer-to-peer network, it will become easier to do business without any geographical restrictions.
Healthcare, for example, will also benefit from it by providing a place to store information for seamless access by authorities and patients.
Note: This question is a subjective blockchain interview question. So, you can answer it in your own way. Just try to be rational in your approach and do give real-world examples in your answer.
31. What are the key characteristics of a blockchain?
Answer: The following are the key characteristics of blockchain that gives organizations a high level of trust in the transaction data.
1. Decentralized and Distributed: Unlike a conventional database in which data is stored in central data servers, the data in a blockchain is stored in multiple computers across networks. This makes it impossible for someone to corrupt or manipulate the data.
2. Secure: Blockchain is encrypted. Each block of the blockchain is encrypted to make it secure and unique.
3. Smart contracts: Smart contracts are rules that define the type of transactions that participants can carry out in the blockchain. This ensures that everyone is playing by the same rules.
3. Consensus: There must be an agreement between all relevant parties before a transaction can be executed. This keeps out inaccurate or fraudulent data from the database.
Immutable: Once a transaction is agreed upon and recorded it cannot be changed. You can add another transaction to change its state, but the original transactions remain in history.
32. How is IBM leveraging its position in the market as a trusted brand? How have early adopters impacted the development and growing success of this technology?
Answer: IBM aspires to be seen as a trusted brand in this market given our position as a neutral technology vendor that is helping companies use blockchain to enable transparency and traceability across their own networks. This is truly a solution for the entire food ecosystem, rather than just a handful of companies. We are already seeing organizations that never before would have interacted or shared data with one another, see the benefits of doing so with blockchain technology and begin to collaborate.
IBM announced a broad collaboration with several of the industry’s leading retailers, suppliers, and distributors in 2017. Early adopters include Dole, Driscoll’s, Golden State Foods, Kroger, McCormick, McLane, Nestlé, Tyson, Unilever and Walmart. This community of innovators and influencers has enabled IBM to better understand how to effectively provide value for the food industry with IBM Food Trust.
33. What is your vision for the future of blockchain and how it could impact the food industry? Beyond food safety, what other industries are IBM looking at to introduce blockchain technology?
Answer: The impact of blockchain in the food industry will be seen in the reduction of the time it takes to identify the source of contaminations, in how it makes recalls more efficient, reduced fraud in food, more transparent supply chains, greater collaboration among industry participants, fewer foodborne illnesses, and more.
Blockchain can be applied to any use case where participants across a network need to transact with greater trust and where there is no one trusted source that exists. Aside from IBM Food Trust, IBM has launched a number of other blockchain initiatives, including global trade digitization for global supply chains and a cross-border payment solution running on Stellar.
34. What are your opinions on the Hyperledger Project?
Answer: The Hyperledger Project is an obvious first step at global adoption and standardization. Blockchain and distributed ledger technology can’t get the attention it deserves without sharing and discovering the technology’s strengths and weaknesses. Loyyal joined the Hyperledger Project early because we understand this need for competition.
The Loyyal platform, built on blockchain, is transforming the loyalty and rewards industry by offering interoperability, multi-branded coalitions, superior liability management, and dynamic issuance and redemption options. Where will blockchain take your company? Join the IBM Blockchain Ecosystem to access technical resources and community expertise around Hyperledger and enterprise blockchain development so you can get started on your blockchain transformation.
35. How will blockchain transform industry roles?
Answer: Blockchain brings amazing new tools that will help streamline specific aspects of jobs that are repetitive. As soon as we can model in our token specific processes, they will then be used in a seamless way to provide more value to companies so that they can be more efficient. We can, therefore, focus on more demanding aspects of the job at hand; strategies, results, decision-making, etc.
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