Blockchain Technology Core Concepts 4 — Questions and Answers
Question 1: What is the UTXO model used in Bitcoin, and how does it differ from the account model used in Ethereum?
- UTXO tracks unspent transaction outputs; account model tracks balances directly in named accounts (Correct answer)
- UTXO uses smart contracts; account model uses mining
- UTXO requires identity verification; account model is anonymous
- UTXO is only for large transactions; account model handles microtransactions
Correct answer: UTXO tracks unspent transaction outputs; account model tracks balances directly in named accounts
Bitcoin's UTXO model tracks individual unspent outputs as spendable inputs, while Ethereum's account model maintains a global state of balances.
Question 2: What is 'block propagation' and why does its speed matter in blockchain networks?
- The process of encrypting a block before broadcasting
- The time it takes for a newly mined block to reach all nodes, affecting orphan block rates (Correct answer)
- The method by which nodes archive old blocks
- The validation process for block headers
Correct answer: The time it takes for a newly mined block to reach all nodes, affecting orphan block rates
Slow block propagation increases the chance of competing miners producing orphan blocks simultaneously, wasting computational resources.
Question 3: What role does a blockchain explorer serve for end users?
- It mines new blocks on behalf of users
- It provides a searchable interface to view transactions, blocks, and wallet addresses on the blockchain (Correct answer)
- It stores private keys securely for hardware wallets
- It converts cryptocurrency between different blockchains
Correct answer: It provides a searchable interface to view transactions, blocks, and wallet addresses on the blockchain
Blockchain explorers like Etherscan or Blockchain.info let users look up transaction status, wallet balances, and block details in real time.
Question 4: What is a multi-signature (multisig) transaction and what security benefit does it provide?
- A transaction signed with a single very long key for extra entropy
- A transaction that requires multiple private key signatures before it can be executed (Correct answer)
- A batch of multiple transactions grouped into a single block entry
- A transaction encrypted with multiple symmetric keys
Correct answer: A transaction that requires multiple private key signatures before it can be executed
Multisig requires M-of-N designated private keys to sign a transaction, reducing single-point-of-failure risk.
Question 5: In Proof of Stake, what is 'slashing' and why is it important?
- Reducing block rewards when the network is congested
- Penalizing validators who act maliciously by destroying part of their staked tokens (Correct answer)
- Splitting the blockchain into shards to improve throughput
- Removing inactive nodes from the validator set
Correct answer: Penalizing validators who act maliciously by destroying part of their staked tokens
Slashing deters dishonest validator behavior (e.g., double-signing) by burning a portion of their staked collateral as punishment.
Question 6: What is an 'orphan block' (also called a stale block) in blockchain?
- A block with zero transactions that is discarded
- A valid block that is not included in the main chain because another block at the same height was accepted first (Correct answer)
- A block whose miner's identity is unknown
- A block that failed cryptographic validation and was rejected
Correct answer: A valid block that is not included in the main chain because another block at the same height was accepted first
Orphan blocks occur when two miners solve a block simultaneously; only one is adopted into the longest chain, making the other orphaned.
Question 7: What cryptographic primitive allows a user to prove ownership of a private key without revealing it during a blockchain transaction?
- Symmetric encryption
- Digital signature (e.g., ECDSA) (Correct answer)
- One-time pad
- Key derivation function
Correct answer: Digital signature (e.g., ECDSA)
Digital signatures like ECDSA let a user sign a transaction with their private key; anyone can verify it with the corresponding public key without learning the private key.
Blockchain Technology Core Concepts 4
What is the UTXO model used in Bitcoin, and how does it differ from the account model used in Ethereum?