Blockchain Interview Questions

10 Effective Blockchain Interview Questions

The team at GoApti has prepared a list of 10 Blockchain interview questions that will help strengthen your preparation.

blockchain is a list of records, called blocks, that are linked using cryptography. Each block contains a cryptographic hash of the previous block, a timestamp, and transaction data (generally represented as a Merkle tree).

By design, a blockchain is resistant to the modification of data. It is “an open, distributed ledger that can record transactions between two parties efficiently and in a verifiable and permanent way.” For use as a distributed ledger, a blockchain is typically managed by a peer-to-peer network collectively adhering to a protocol for inter-node communication and validating new blocks.

Once recorded, the data in any given block cannot be altered retroactively without the alteration of all subsequent blocks, which requires consensus of the network majority. Source: Wikipedia

1. What do you mean by blockchain? What are the basic differences between ethereum blockchain and bitcoin blockchain?

Blockchain is designed for maintaining decentralized immutable data in a distributed platform without any loss of data across the chain. Blockchain follows a trusted approach and a lot of organizations are delving into the practical applications of blockchain.

This trusted approach will only develop in the long run as it is open-source. Bitcoin deals with currency or “digital currency” to be more specific, whereas ethereum is used for contracts The industry-accepted term for such a contract is “smart contract”.

Satoshi Nakamoto is the person who came up with bitcoin, and Vitalik Buterin invented Ethereum. The thinking approach for bitcoin is based on the normal block or “genesis block” concept. Ethereum is based on pre-sales.

Bitcoin uses SHA-256 algorithm, whereas ethereum relies on Keccak-256 hash function. Bitcoin has a 10 minute block time, while ethereum’s block time is 12-14 seconds.

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2. How do you explain blockchain in simple words?

Richard Bradley explains what Blockchain is in Deloitte’s broadcast series “Technology Decoded”,

“You (a “node“) have a file of transactions on your computer (a “ledger”). Two government accountants (let’s call them “miners”) have the same file on theirs (so it’s “distributed”). As you make a transaction, your computer sends an e-mail to each accountant to inform them.

Each accountant rushes to be the first to check whether you can afford it (and be paid their salary “Bitcoins”). The first to check and validate hits “REPLY ALL”, attaching their logic for verifying the transaction (“proof of work”). If the other accountant agrees, everyone updates their file.”

3. What are the types of blockchain?

There are three kinds of blockchain in the market: public blockchain where information is viewable by everyone, a private blockchain where information is viewable to the specific person, and the third one is a consortium, where the group of members can able to view required information.

Also Read: Top 25 Most Popular Computer Science Interview Question and Answers

4. What kind of blockchain records are held in a database?

A question on the types of records in the blockchain is frequently asked in interviews. Two kinds of records are held in blockchain without loss of information. One is a block record and the other one is a transactional record. Both records are popular and easy to access without any major implementation requirements. A major feature of these database records is that they can be integrated with each other without any difficulty.

5. What is the difference between a traditional database and a blockchain database?

A Blockchain database stores two kinds of data in its database, one is block data and the second one is traditional data. A blockchain database allows only the insert operation, it does not permit update and delete operation. On the other hand, a traditional database allows create, insert, update, and delete operations. Full replication is required in a blockchain for every peer.

A blockchain-based database does not have a slave concept, whereas a traditional database follows the master-slave or multi-master concept.

Traditional databases followed 2-phased transactions or distributed transactions. Blockchain does not have any kind of relational dependency, so anyone can access the bitcoin transactions inside the same network. Traditional databases, however, have the concept of constraints that can restrict and modify dependencies.

6. What are some of the major features of blockchain?

Some key features are system decentralization, proper distribution of ledger, and a secure ecosystem that is safe for all.

7. Why is encryption needed?

Data security is a major concern for every organization. Encryption of data is mandatory for ensuring security. Encryption works by converting the data into a format that only the data sender and the intended recipient can decode and interpret.

8. What are blocks in blockchain?

A block is a file that stores information about the transactions executed in a given time period. Once a block gets filled, another block is added. This creates a link of blocks connected to each other and hence the term “blockchain”.

9. How do you identify a block within a blockchain?

If someone asks you what is blockchain, you also need to mention how a block is identified. Every block has one hash pointer which is considered as a link to the block.

10. Is it possible to modify a specific block within the chain?

No, modification is not possible since a blockchain is immutable. Any transaction once recorded cannot be altered. If the blockchain is to be modified, the updated data needs to be added as a block in the blockchain.

Did these blockchain questions teach you something you weren’t aware of? Is there any concept in blockchain that is important for interviews? Have you cleared a blockchain-based interview? We’d love to hear from you.

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