Blockchain Technology Cryptography in Blockchain 3 — Questions and Answers
Question 1: In Bitcoin's HD wallets (BIP-32), what is the role of the chain code alongside an extended key?
- It serves as the wallet's mnemonic seed phrase
- It provides additional entropy to prevent child key derivation without it (Correct answer)
- It stores the transaction history locally
- It is the compressed form of the public key
Correct answer: It provides additional entropy to prevent child key derivation without it
The chain code is 256 bits of extra entropy combined with the key, ensuring child key derivation requires both components to proceed.
Question 2: Which hash function does Bitcoin use to produce a 256-bit block hash in Proof of Work?
- SHA-3
- RIPEMD-160
- SHA-256 applied twice (SHA-256d) (Correct answer)
- Keccak-512
Correct answer: SHA-256 applied twice (SHA-256d)
Bitcoin applies SHA-256 twice to block headers (SHA-256d) to produce the block hash used in Proof of Work difficulty comparison.
Question 3: What does 'hardened' child key derivation in BIP-32 prevent compared to 'normal' derivation?
- Prevents duplicate wallet addresses
- Prevents leaking the parent private key if a child private key is compromised (Correct answer)
- Prevents use on testnet
- Prevents spending from cold storage
Correct answer: Prevents leaking the parent private key if a child private key is compromised
Hardened derivation uses the parent private key (not public key) as input, so a compromised child private key cannot be used to derive the parent private key.
Question 4: Ethereum uses Keccak-256 rather than the standardized SHA-3. What is the key difference?
- Keccak-256 produces a 512-bit output
- Ethereum's Keccak-256 uses different padding than NIST's final SHA-3 standard (Correct answer)
- SHA-3 is not suitable for 64-byte inputs
- Keccak-256 requires a secret key
Correct answer: Ethereum's Keccak-256 uses different padding than NIST's final SHA-3 standard
Ethereum adopted Keccak before NIST finalized SHA-3 with modified padding; both are sponge constructions but produce different outputs for the same input.
Question 5: In a threshold signature scheme (e.g., t-of-n multisig via Shamir's Secret Sharing), what must be true to reconstruct the secret?
- All n shares must be combined
- Any t shares out of n are sufficient (Correct answer)
- Shares must be combined in a specific order
- The dealer must participate in reconstruction
Correct answer: Any t shares out of n are sufficient
Shamir's Secret Sharing is designed so that any t (threshold) shares are sufficient to reconstruct the secret, while fewer than t reveal nothing.
Question 6: What is the purpose of the RIPEMD-160 hash applied after SHA-256 when creating a Bitcoin address?
- To increase hash difficulty for miners
- To shorten the public key hash to 160 bits for a more compact address (Correct answer)
- To add a checksum to the address
- To derive the private key from the public key
Correct answer: To shorten the public key hash to 160 bits for a more compact address
Applying RIPEMD-160 to the SHA-256 hash of the public key produces a shorter 160-bit value, making Bitcoin addresses more compact.
Question 7: Which statement about symmetric vs. asymmetric cryptography in blockchain is most accurate?
- Blockchain uses symmetric cryptography for transaction signing
- Asymmetric cryptography handles key pairs for signing; symmetric cryptography may be used for data encryption off-chain (Correct answer)
- Asymmetric cryptography is faster than symmetric for bulk data
- Blockchain relies solely on symmetric keys for all operations
Correct answer: Asymmetric cryptography handles key pairs for signing; symmetric cryptography may be used for data encryption off-chain
Blockchain transaction signing uses asymmetric (public/private) key pairs, while off-chain data encryption often employs faster symmetric algorithms.
Blockchain Technology Cryptography in Blockchain 3
In Bitcoin's HD wallets (BIP-32), what is the role of the chain code alongside an extended key?