FREE Cryptocurrency Cryptography and Hashing Questions and Answers

Question 1

Which of the following is NOT a fundamental property of a cryptographic hash function used in blockchain technology?

Accepted Answer

Reversibility

Answer

Cryptographic hash functions are designed to be one-way, meaning it is computationally infeasible to reverse the function and find the original input from the output hash. This property is known as pre-image resistance. [2, 20] Deterministic means the same input will always produce the same output. [2, 12] Collision resistance means it is computationally infeasible to find two different inputs that produce the same hash output. [2, 21]

Question 2

A user wants to send a secure message to another user on a cryptocurrency network, ensuring both confidentiality and authenticity. The sender uses the recipient's public key to encrypt the message. What must the recipient use to decrypt the message and what does this process primarily ensure?

Accepted Answer

The recipient's private key, to ensure confidentiality.

Answer

In asymmetric cryptography, a message encrypted with a public key can only be decrypted by the corresponding private key. [3, 17] Since the sender used the recipient's public key, only the recipient, who holds the matching private key, can decrypt it. This process ensures confidentiality, meaning only the intended recipient can read the message.

Question 3

In the context of Bitcoin's Proof-of-Work, miners repeatedly hash the block header with a changing nonce. What is the primary goal of this process?

Accepted Answer

To find a hash value that is below a certain target value.

Answer

Bitcoin's Proof-of-Work (PoW) consensus mechanism requires miners to find a hash for the block header that is below a specific target value set by the network's difficulty. [12, 22] They do this by iterating through a number called a 'nonce' until the resulting hash meets the condition. This process requires significant computational effort, which secures the network.

Question 4

A developer is creating a new cryptocurrency and needs to choose a hashing algorithm. They are deciding between SHA-256 and Keccak-256. Which major cryptocurrency is primarily associated with Keccak-256?

Accepted Answer

Ethereum

Answer

Ethereum uses Keccak-256 as its primary hashing algorithm, which is a member of the SHA-3 family. [7, 14] Bitcoin famously uses the SHA-256 algorithm. [1, 27] Litecoin and Dogecoin both use the Scrypt algorithm. [16]

Question 5

To create a digital signature for a transaction, a user's wallet software first hashes the transaction data. What is the next step in this process?

Accepted Answer

The hash is encrypted with the user's private key.

Answer

A digital signature is created by taking the hash of the message or transaction data and then encrypting that hash with the sender's private key. [13, 19, 23] This proves that the owner of the private key authorized the transaction, providing authenticity and non-repudiation.

Cryptocurrency Practice Test

Cryptocurrency Practice Test

FREE Cryptocurrency Cryptography and Hashing Questions and Answers