Blockchain technology is set to be the most promising field for the future that one could think of. Its ability to grow in an unlimited fashion the world over is because of the fact that it is something more than just a technology: it can be a panacea for all the drawbacks associated with the financial transactions that take place globally.
In fact, blockchain goes beyond finance. It can combine with another emerging technology, Internet of Things (IoT) and help to track possibly everything on this planet. Any wonder then, that the market for blockchain is seen in billions in the years to come?
1st Round: Blockchain Basic interview questions and answers:
Q1. What is Blockchain?
Ans: Blockchain is a cardinal ledger of financial transactions that is essentially programmed to record transactions, but it goes beyond financial transactions. It can record virtually anything and everything of value. The heart of blockchain is the guarantee that every action can be documented and tracked in a way that cannot be manipulated. This has unimaginable consequences for the future. Blockchain technology, which was discovered with the advent of Bitcoins, is set to revolutionize our world as it exists today.
Q2. Explain the principle of Blockchain Technology?
Ans: Being a decentralized system of logging, Blockchain technology runs on the basic premise of being a system in which the information can be disseminated without a central authority such as banks, as is the case with traditional financial systems.
Q3. Mention the types of Blockchains
Q4. Mention the two types of records that are present within the Blockchain Database?
Ans: 1. Block records
2. Transactional records
Both these kinds of records are retrieved and integrated with another without following the difficult algorithms
Q5. What are the blocks within the Blockchain Technology?
Ans: These are used to store the list of records that is in the Blockchain system. Being successively associated with all other blocks, it comes to represent a series known as Blockchain.
Q6. How do you recognize a block within the Blockchain approach?
Ans: A hash pointer that each block contains within the online ledger, which acts as a joint between the blocks, is the block within the blockchain approach.
Q7. Is it possible to switch the data once it’s written in an exceeding block?
Ans: No. This is the core feature of blockchain, which distinguishes it from any other ledger system. If a company wants to make changes to any data, it needs to remove the information from all the blocks as well. This calls for extreme care and caution while entering data. As mentioned, this approach has enormous implications for financial transactions in the future.
Q 8. How is the security of a block ensured?
Ans: Every block in a Blockchain is secured by a strong cryptographic hash algorithm. This is the defining feature of this technology. Each block consists of a unique hash pointer. Any change that one does in the block element will take to the change in the hash identifier of the block. This ensures a highly secure means of carrying out transactions.
Q9. What are Merkle trees?
Ans: Also known as hash tree, a Merkle tree is a data structure in which each leaf node could be hash of a block of knowledge and every non-leaf node could be a hash of its kid nodes.
Q10. What are the differences between blockchain ledger and a standard one?
Ans: The first and most important of the distinctions is that Blockchain is a highly decentralized digital ledger which is simple to work on but is immutable once an operation is carried out. The chances of error in this system are far, far fewer than those in the standard one, which is easy to manipulate. Moreover, while most entries to the standard ledger has to be done manually, blockchain automates it, eliminating the smallest chance of tampering.
Q11. What kind of records can be kept in a Blockchain? Is there any restriction on same?
Ans: The types of records that are kept in Blockchain are:
- Business transactions
- Identity management
- Management activities
- Transaction process
- Records of medical transactions
In fact, there are no restrictions on keeping records in the blockchain.
Q12. Which are the elements of the Blockchain Ecosystem?
Ans: These are the elements of Blockchain system:
- Shared Ledger
- Node application
- Virtual Machine
- Consensus Algorithm
Q13. Which are the platforms for developing blockchain applications?
Ans: There are many of them, although Ethereum is at present the most preferred public platforms for building Blockchain based applications. These are some of the others:
Q14. List some of the Advantages of Blockchain
Ans: This is a summary of some of them:
- Blockchain is terribly inexpensive for the purpose it serves
- It enables financial settlement in real time
- It ensures security of transactions
- A transaction once made can never be changed. This is the highpoint of blockchain, making it something of invaluable benefit to the financial systems around the world
- The user can remain anonymous, even though the transaction is immutable
Q15. Can a block in the blockchain never have more than one parent block?
Ans: No. Blockchain can never have a parent Block, which means that each and every block is independent in Blockchain
Q16. Name some of the popular cryptographic algorithms?
- Triple DES
Q17. Mention the methods used in attacking the RSA algorithm
Ans: These are:
- Mathematical attacks: In this attack, we tend to square measure mistreatment totally different methods, that is similar in the effort to issue the merchandise of 2 primes
- Brute force: It includes all potential secret keys
Q18. Explain a blind signature and show how it is useful
Ans: Blind signature can be thought of as being a digital signature within which the content is blinded before it is signed. The ensuing blind signature may be publicly confirmed against the first, unblinded message within the manner set out by a daily digital signature. Blind signatures are normally used in privacy-related protocols where the signer and message author are different.
Q19. Describe Secret Sharing. Does it carry any benefit in Blockchain technology?
Ans: Secret Sharing is an indispensable element of digital transactions. It is an associate or supplementary approach that splits secret or personal data into different small units and direct them towards the users on the network.
The genuine data will merely be assimilated once a candidate confirms to combine them at the side of others. Their square measure many security-related advantages it offers in Blockchain technology.
Q20. What is the difference between proof of stake and proof of work?
Ans: Proof of Work
Proof of Stake
The probability of mining a block depends on the amount of work a miner does
Stakeholders validate new block by utilizing their share of coin on the network
Consumes more energy than proof of stake
The first example of proof of stake is Peer coin
2nd Round: Blockchain Technical Interview Questions and answers:
Q1. Define encryption and its role in Blockchain?
Ans: Encryption is a method of helping organizations keep their data secure.The encrypted data is encoded or altered to some extent before it is sent out of a network by the sender. Only authorized parties can access that information. How this approach helps in Blockchain is that it adds an extra layer to the overall security and authenticity of blocks and helps to keep them secure.
Q2. What are blocks in the blockchain technology?
Ans: Blockchain consists of a list of records. Each of these records is stored in blocks. These blocks are in turn linked with other blocks and hence constitute a chain called Blockchain.
Q3. Explain Merkle trees and their importance to Blockchains
Merkle Tree, also 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.
This is how using the Merkle Tree helps in blockchain: instead of downloading every transaction and every block, a “light client” can only download the chain of block headers.
In addition, if someone needs to verify the existence of a specific transaction in a block, there is no need download the entire block. It is enough to download just a set of a branch of this tree which contains this transaction. Taking a look at the hashes will give an indication of its status: when they are going up the branch. If these hashes check out good, then it indicates that this particular transaction exists in this block.
Q 4. Which are the common type of ledgers that can be considered by users in Blockchain?
Ans: These are:
Q 5. Which are the components of Blockchain Ecosystem?
Ans:The following are the components of blockchain Ecosystem:
Q 7.Graphically explain some of the widely used cryptographic algorithms?
Q 8.What do you understand by processing? What are some of the key challenges associated with it?
Ans:Information is often shared on a network. Before transmitting it over a network, this information needs to be changed into formats that can fit the standards of the channels, which are the link between the sender and a receiver.
Information processing is what is done to convert the information at both sender and receiver end. The biggest challenge to information processing is keeping it secure during that time. Also, processing bulk information can limit the performance.
Q 9.Explain some of the key principles in Blockchain that are helpful in eliminating the security threats
3. Securing testing and similar approaches
4. Database security
5. Continuity planning
6. Digital workforce training
Q 10. List some of the popular consensus algorithms. Why are different consensus mechanisms needed?
Ans:These are some of the popular consensus algorithms:
- PBFT (Practical Byzantine Fault Tolerance)
- Delegated proof-of-stake
- Proof-of-elapsed time
- Some of the reasons for which consensus mechanism are needed more than “proof-of-work” are:
- Business needs could be different
- Use cases could be different
- Cryptography/Strength of Algorithm
- Regulation requirements
Q11. Show a real-life use-case where Blockchain is being used?
Blockchain in Stock Market
Problems in Present Stock Market:
Centralized and expensive
- Depositories and transfer agents are a focal point of failure
- Comes with registration, transfer, distribution, scrutinizing and courier fees
- The higher the prevalence, the higher the administrative costs
Transparency is severely compromised
- One who has higher information has an advantage. This is not bad in itself, but this leads to insider information, the cause of many high-profile lawsuits
- Smart crooks can fudge data
- Other players can retaliate with even more manipulative practices
How Blockchain solves the problem
By removing the centralized hub, blockchain can be used to directly transfer share ownership between investors.
A ledger updated in very nearly real-time offers the real solution: it could potentially save millions in collateral and settlement costs, while also automating banks’ back office systems.
1.Describe your qualification and experience in working with blockchain
2. What growth prospects do you see for yourself and this organization in blockchain?
3. In what way do you think blockchain can change the course of financial history?
4.What skillset do you bring that could facilitate this?
5.Do you think blockchain is the technology for the future? How do you say so?
Blockchain is being hailed as one of the technologies that could completely alter the face of one of mankind’s most used activities: financial transactions. It has the potential to obliterate all the ills that plague the current financial systems around the world. by making each and every transaction trackable, it brings in an element of transparency into financial system of a nature and scale that was not witnessed till now. The perfect cure to black money could well be within sight!
There is no better time to be in this field than now. Since blockchain is an emerging technology, it is expected to grow in inconceivable ways in the years and decades to come. This is our modest effort in helping you be equipped to handle questions and answers when you face an interview as a blockchain professional.