Blockchain Interview Questions

In this article, we test our knowledge of blockchain using 60 multiple-choice questions.

1. Who is famous for creating Ethereum?
(a) Craig Wright
(b) Satoshi Nakamoto
(c) Vitalik Buterin
(d) Joseph Lubin

Answer: (c)
Explanation: Vitalik Buterin created the Ethereum blockchain.

2. Who is famous for creating Bitcoin?
(a) Satoshi Nakamoto
(b) Dorian Nakamoto
(c) Vitalik Buterin
(d) Craig Wright

Answer: (a)
Explanation: Satoshi Nakamoto created the Bitcoin blockchain.

3. A node is ____
(a) a cryptocurrency.
(b) a computer on the blockchain.
(c) a crypto exchange.
(d) a type of blockchain.

Answer: (b)
Explanation: A node in the blockchain is just a computer that has the blockchain software installed. It runs the blockchain.

4. What does P2P represent?
(a) Product-to-Product
(b) Private-to-Public
(c) Password-to-Password
(d) Peer-to-Peer

Answer: (d)
Explanation: P2P stands for peer to peer. Blockchains rely on P2P networks for propagating transactions, and communication with other nodes among other functions. In a peer-to-peer network, all network nodes have an equal standing there are no superiors rather, every node has to agree on all network activities.

5. Which of the following canNOT be used to store cryptocurrency?
(a) Mobile App
(b) Desktop App
(c) USB stick
(d) All the above.

Answer: (d)
Explanation: Cryptocurrency can be stored on USB sticks, desktop apps, and mobile apps that act as digital wallets. Crypto can also be stored on paper by using a paper wallet. Note that we don't actually store the crypto, rather we store the keys that allow us to access crypto on the blockchain.

6. Who is a miner?
(a) Person who creates a blockchain
(b) Person who uses their computers that validate and process blockchain transactions
(c) Person with an algorithm to validate the blockchain
(d) None of the above

Answer: (b)
Explanation: A miner person who uses their computers that validate and process blockchain transactions. A miner contributes his/her computing power to gain incentives from the network.

7. Where can we buy cryptocurrency?
(a) A Bitcoin ATM
(b) All the above
(c) A crypto exchange
(d) A private transaction

Answer: (c)
Explanation: Cryptocurrency can be acquired from any of the above sources.

8. Which among the following is not a blockchain token?
(a) Computing Power.
(b) Privacy.
(c) Currency.
(d) Platform.

Answer: (a)
Explanation: Computing power is not a token in blockchains.

9. Among the following, which is NOT part of asymmetric encryption?
(a) A public key
(b) A private key
(c) Cipher text
(d) Mining

Answer: (d)
Explanation: Mining is not part of asymmetric encryption. Asymmetric encryption also referred to as public-key cryptography involves a public and a private key. A cipher text is the result of this encryption.

10. What is a blockchain?
(a) A form of cryptocurrency.
(b) A cryptocurrency exchange.
(c) A distributed ledger on a peer-to-peer network.
(d) A P2P network.

Answer: (c)
Explanation: The blockchain is simply a distributed ledger on a peer-to-peer network.

11. Which of the following is an attribute of a currency?
(a) All the above.
(b) Scarcity.
(c) Divisibility.
(d) Portability.

Answer: (a)
Explanation: A currency should be scarce, divisible, portable, accepted, durable, and resistant to counterfeiting.

12. What type of trees are used in blockchain blocks.
(a) AVL
(b) Merkle
(c) Reb Black.
(d) Binary Search Trees

Answer: (b)
Explanation: Blockchains block uses the Merkle tree to store transactions.

13. What can be found in a block in a blockchain?
(a) Public keys.
(b) Cryptocurrency coins.
(c) Private keys.
(d) Transactions.

Answer: (d)
Explanation: A block in a blockchain collects transactions and stores them in a Merkle tree whose leaves are the hashed of the transactions and the root of the collective hash of all the transaction hashes.

14. Which among the following is a type of blockchain?
(a) Distributed blockchains
(b) Closed blockchains
(c) Public blockchains
(d) None of the above

Answer: (c)
Explanation: Blockchains can be public, private, or permissioned. Public blockchains allow everyone to join and participate, private blockchains are limited to a chosen few and permissioned blockchains allow users with permissions to participate in them

15. Which among the following is NOT a component of the blockchain.
(a) Hashing
(b) Digital signatures
(c) Distributed ledger
(d) Digital Certificates

Answer: (d)
Explanation: Digital certificates are NOT part of a blockchain. On the other hand, digital signatures are used to sign transactions, the blockchain is a distributed ledger or records and finally, hashing is used to secure the blockchain.

16. What is used in asymmetric encryption?
(a) Private keys and paraphrases
(b) Public and private keys
(c) Private keys only
(d) None of the above

Answer: (b)
Explanation: Asymmetric encryption also referred to as public key cryptography uses public and private keys whereby the private key of the sender is used to encrypt the message and his/her public key to decrypt the message by the recipient of the message.

17. Which is among the blockchain trilemma?
(a) All the above.
(b) Decentralization.
(c) Scalability.
(d) Security.

Answer: (a)
Explanation: The above three make up the blockchain trilemma. Trilemma in that, a blockchain can only provide two of these. That is a blockchain can be either decentralized and scalable but not secure because scalability comes at the cost of security also a blockchain can be secure and decentralized but not scalable for example Bitcoin.

18. Where are cryptocurrency coins stored?
(a) On the computer
(b) In a crypto wallet
(c) On the blockchain(distributed ledger)
(d) None of the above

Answer: (c)
Explanation: Digital assets(crypto coins) are stored on the distributed ledger that is the blockchain. The rest, for example, computers, USB sticks, and hard disks are only used to store the keys that are used to access the coins on the blockchain.

19. What is a private key?
(a) A key given to the public
(b) Alphanumeric text that is used to access coins on the blockchain
(c) A key to open the blockchain
(d) None of the above

Answer: (b)
Explanation: A private key is what is between a user and his/her coins, If compromised, so are the funds. In our case, it is an alphanumeric text that should be kept secret.

20. When was Ethereum created?
(a) 2014
(b) 2020
(c) 2015
(d) None of the above.

Answer: (c)
Explanation: Ethereum was created back in 2015.

21. When was Bitcoin created?
(a) 2009
(b) 2007
(c) 2008
(d) 2006

Answer: (a)
Explanation: Bitcoin was created back in 2009.

22. What is a genesis block?
(a) None of the above
(b) The last block in a blockchain
(c) The recently mined block in a blockchain
(d) The first block in a blockchain

Answer: (d)
Explanation: A genesis block is the first block in a blockchain. The genesis block in Bitcoin was mined in 2009 and the genesis block in Ethereum was mined in 2015.

23. Why do miners mine cryptocurrency?
(a) They are paid by the government
(b) For praise
(c) They receive an incentive
(d) They are enthusiastic about the blockchain

Answer: (c)
Explanation: Miners mine blocks to receive incentives in form of native coins of the blockchain they are mining for. Currently, the block reward for mining a Bitcoin block is 6.25 Bitcoins and that of mining Ethereum is 2 Ether. This reward is compensation for miners using their computational resources to maintain the blockchain.

24. How are new crypto coins added into circulation?
(a) Through mining
(b) They are printed
(c) They are sent after starting a node
(d) None of the above

Answer: (a)
Explanation: Bitcoins or Ether are introduced into circulation as rewards to miners when they mine a block adding it to the chain. When a block is mined not only will the miner be rewarded for mining but also for processing the transactions and validating them. This helps to keep the blockchain secure.

25. What is meant by cold storage?
(a) A mobile wallet
(b) Storing keys online
(c) Storing keys offline
(d) None of the above

Answer: (c)
Explanation: Cold storage refers to the storage of keys offline. For example, we could write private keys on a piece of paper and store it in a safety deposit box at a bank or store keys on a USB flash disk, as long as they are offline, they are in cold storage.

26. Which among the following is a consensus mechanism used in blockchains.
(a) Proof of Elapsed Time(PoET)
(b) Proof of Work(PoW)
(c) Proof of Stake(PoS)
(d) All the above

Answer: (d)
Explanation: All the above are different types of consensus mechanisms. A consensus mechanism for example the PoW mechanism requires the exertion of computational power to solve a puzzle to keep all nodes in the network honest. This secures the blockchain. The PoS keep the network honest by having miners keep a stake in the network such that if they try to misbehave, their stake acts as the penalty for their misbehavior.

27. What is the PoW(Proof of Work)?
(a) The amount of work done by miners
(b) A consensus mechanism in blockchain technologies
(c) An algorithm for mining transactions
(d) None of the above

Answer: (b)
Explanation: PoW is a consensus mechanism in blockchain technologies. It helps to keep a blockchain network secure by discouraging miners to misbehave because if they do, they risk losing their block reward meaning they wasted electricity and computational resources during mining the block.

28. What is a nonce?
(a) None of the above
(b) A cryptographic hash
(c) The target number to solve the PoW algorithm
(d) A number used once

Answer: (d)
Explanation: A nonce is a number used only once. In blockchains, it is combined with the block header to reach the set target. If the target is not reached, the nonce is changed and the hashing starts again, this repeats until the condition is fulfilled. If all nonces have been exhausted, other methods such as the extra nonce solution are used among others.

29. What is a blockchain fork?
(a) A reconvergence of a blockchain
(b) A decentralized ledger
(c) A splitting of a blockchain into two or more chains
(d) None of the above

Answer: (c)
Explanation: A blockchain fork is the splitting of a blockchain into two or more chains. Blockchain forks can be caused by bugs in the software or disagreement between the involved parties. Examples of real blockchain forks include Bitcoin Cash and Ethereum Classic among others.

30. What is a DAPP?
(a) A type of blockchain.
(b) A cryptocurrency.
(c) Decentralized Application.
(d) A node.

Answer: (c)
Explanation: Dapp is a decentralized application. Consider Facebook, it stores all our data on its servers and owns it, and can do with it what they want this is a centralized app since a single entity has control over the data and can profit from it, on the other hand, we have minds this is a decentralized facebook and youtube alternative with no central authority controlling the data, the users control their data and can sell it and profit from their data.

31. What technology is used in Bitcoin and Ethereum.
(a) Blockchain
(b) Machine Learning
(c) Artificial Intelligence
(d) None of the above

Answer: (a)
Explanation: Bitcoin and Ethereum use blockchain technology. The blockchain is a chain of blocks storing information that is very hard to change or mutate because it is decentralized and to change one we have to change all which is very hard.

32. Which site was shutdown for selling drug online that used Bitcoin for payments?
(a) Silk Road
(b) Drugs.com
(c) Silk.com
(d) None of the above

Answer: (a)
Explanation: Silk Road was a digital black market platform that was popular for hosting money laundering activities and illegal drug transactions using Bitcoin.

33. Hash functions transform an arbitrary string of any length to a fixed-length string.
(a) All of the above
(b) False
(c) None of the above
(d) True

Answer: (d)
Explanation: Hash functions transform an arbitrary string of any length into a fixed-length string that can be used as a digital fingerprint. Examples of hash functions used include SHA-256, and Keccack-256 among others.

34. Where is the Bitcoin main server located?
(a) China
(b) US
(c) Russia
(d) None of the above.

Answer: (d)
Explanation: Bitcoin does not have a centralized server rather it is a decentralized system that is run on multiple servers in different locations around the world. We can even start our server right where we are and it grows the network.

35. What is the purpose of a distributed ledger?
(a) Identify object owners
(b) Identify objects owned
(c) Mapping owner and object
(d) None of the above

Answer: (c)
Explanation: A distributed ledger maps wallet addresses with digital assets in the blockchain. For example, the private key a user owns maps the user to the Bitcoins stored on the blockchain. Without the key, the user cannot access funds on the blockchain.

36. Which among the industries can use blockchain technology?
(a) Supply Chains
(b) Health care
(c) Logistics
(d) All the above

Answer: (c)
Explanation: Blockchain finds applications in all listed industries including automotive, banking and finance, governance, insurance, media and advertisements, retail and consumer goods, and telecommunications among countless others.

37. What are the pillars of a blockchain?
(a) All the above.
(b) Transparency.
(c) Immutability.
(d) Decentralization.

Answer: (a)
Explanation: A blockchain should be transparent, immutable, and decentralized. In Blockchains such as Bitcoin, all transactions are public, the blockchain is immutable in that it is very difficult to change data and it is decentralized in that its servers are distributed across the globe.

38. What are the benefits of a blockchain?
(a) No hidden fees
(b) Security
(c) No intermediaries
(d) All the above

Answer: (d)
Explanation: A blockchain is safer than a bank, there is no need for intermediaries and there are no hidden fees. Also, fees are lower compared to financial institutions.

39. A blockchain is a
(a) Object
(b) Table
(c) List of records
(d) Database

Answer: (d)
Explanation: A blockchain is a distributed decentralized database.

40. Data in a blockchain is stored in
(a) Records
(b) Lists
(c) Blocks
(d) None of the above

Answer: (c)
Explanation: A block in a blockchain is responsible for storing transactions on the blockchain. In a block, transactions are stored in a tree-like structure referred to as a Merkle tree. Blocks link together to form a chain of blocks. The longer the chain, the more secure it is.

41. A hybrid blockchain is a combination of ____ features.
(a) Decentralized
(b) Centralized and Decentralized
(c) Centralized
(d) None of the above

Answer: (b)
Explanation: A hybrid blockchain combines both centralized and decentralized features.

42. What are the two major implementations of blockchains?
(a) None of the above
(b) Ethereum and Solana
(c) Solana and Cardano
(d) Bitcoin and Ethereum

Answer: (d)
Explanation: Bitcoin and Ethereum are the two major implementations of blockchain technologies.

43. Which is not an application of the blockchain?
(a) None of the above.
(b) DApps
(c) Cryptocurrency exchange.
(d) Smart contracts.

Answer: (a)
Explanation: Blockchain version 1 involved the exchange of value between parties, and version 2 added code execution by introducing smart contracts, now we can build decentralized apps.

44. What does UTXO represent?
(a) Unspent Trade Offer
(b) Unspent Transaction Output
(c) Unique Transaction Output
(d) None of the above.

Answer: (b)
Explanation: UTXO stands for Unspent Transaction Output. This is the digital currency that remains after a transaction on the blockchain. It is also used for subsequent transactions.

45. What is generated for any transaction on the blockchain?
(a) UTXO
(b) Change
(c) Crypto coins
(d) None of the above.

Answer: (a)
Explanation: UTXOs are what is left after a transaction is executed on the blockchain.

46. What is a coinbase transaction?
(a) None of the above
(b) The first transaction on a blockchain
(c) The last transaction in a block
(d) The first transaction in a block

Answer: (d)
Explanation: The coinbase transaction is the first transaction in a block. The blockchain uses this transaction to pay miners for mining the block and processing and validating transactions in the block. The funds are summed up and delivered to a miner using this transaction. It is unique since it has no inputs but produces outputs.

47. How many inputs does a coinbase transaction have?
(a) 0
(b) 1
(c) 2
(d) 3

Answer: (a)
Explanation: A coinbase has NO inputs but produced outputs.

48. What is the purpose of a coinbase transaction?
(a) To pay the blockchain owner
(b) To fill a block
(c) To pay miners
(d) None of the above

Answer: (c)
Explanation: A coinbase holds the block reward together with the transaction fees paid to the miner for his/her efforts.

49. ____ receive, validate, gather and execute transactions.
(a) Digital Wallets
(b) Miner nodes
(c) Light nodes
(d) SPVs

Answer: (b)
Explanation: A miner node receives transactions, validates them, gathers them into a block, and executes them.

50. Bitcoin is a ____ blockchain.
(a) Private
(b) Public
(c) Permissioned
(d) All the above.

Answer: (b)
Explanation: Bitcoin just like Ethereum is a public blockchain and anyone can join and leave as they wish. The Linux Foundation's Hyperledger is an example of a private blockchain.

51. What hashing algorithm is used in blockchains.
(a) LANMAN
(b) MD5
(c) SHA-256
(d) SHA-512

Answer: (c)
Explanation: Bitcoin and Ethereum use the SHA-256 hashing algorithm for their hashing needs. Keccack-256 algorithm is also used in the Ethereum blockchain. Hashing and cryptography(asymmetric) are what secure the blockchain and allow participants to trust the blockchain rather than banks. Between mathematical algorithms and the other option, the former serves best to secure funds.

52. Which of the hashes is used when there is a fixed number of items to be hashed eg, block header.
(a) Complex hashing
(b) Simple hashing
(c) MD5 hashing
(d) All of the above

Answer: (b)
Explanation: Simple hashing is used when there is a fixed number of items that require hashing.

53. What type of hashing is used when the number of items varies?
(a) None of the above.
(b) Simple hash.
(c) Complex hash.
(d) Tree-structured hash.

Answer: (d)
Explanation: Tree-structured hashing is used when the number of items to be hashed varies, e.g transactions in a block. In a block, transactions vary in that given a maximum size of a block, some transactions may be larger compared to others and therefore the number of transactions in a block will vary. Transactions in a block are stored in a Merkle tree which is just like a binary tree but with transactions, hashes are its leaves.

54. The Merkle root is a hash of ____
(a) All block transaction hashes
(b) All block transactions
(c) All block addresses
(d) All of the above

Answer: (a)
Explanation: The Merkle root is a cumulative hash of all transaction hashes in the block. From the leaf nodes, transactions are combined in twos to form a single hash which is the root, this process continues up the tree and we have a Merkle tree root hash. When a single transaction in a block changes, so does the root.

55. How often do Bitcoin blocks reconcile?
(a) 10 days
(b) 2 months
(c) 3 months
(d) Never

Answer: (c)
Explanation: Blocks in a blockchain reconcile at least once a quarter to catch any errors that could be made.

56. What is block height?
(a) None of the above
(b) How high a block is hierarchically in the blockchain
(c) All of the above
(d) The number of blocks between the genesis block and the current block

Answer: (d)
Explanation: The block height is the difference between the current block and the genesis block in a blockchain. The genesis block is the first block mined since the blockchain began.

57. If a hacker wanted to change a transaction, what percentage of block copies would he/she need to change?
(a) 20%
(b) 51%
(c) 10%
(d) None of the above

Answer: (a)
Explanation: A hacker would need to change 51% of block copies. This is referred to as a 51% attack. There are also cases where an attack could happen when a miner controls 30% of nodes in the blockchain.

58. Centralized blockchains are immutable?
(a) Can be both
(b) True
(c) False
(d) None of the above

Answer: (c)
Explanation: Centralized blockchains can be changed by the centralized entity that owns the blockchain. For example, if an organization decided to have a private blockchain, they decide what is recorded or erased from the blockchain, and therefore it won't be immutable.

59. Blockchain forks can lead to ____
(a) Multiple children blocks
(b) Multiple parent blocks
(c) All of the above
(d) None of the above

Answer: (a)
Explanation: A blockchain fork results in multiple child blocks.

60. Blocks in a blockchain are linked to each other ____
(a) Sideways
(b) Forward
(c) Upwards
(d) Backward

Answer: (d)
Explanation: Blocks in a blockchain are linked to each other backwards to the previous block. The current block links to the previous block(backward) by storing the hash of the previous block. In this case, if a transaction in the previous block changes, so does the hash, the current block will now have a different hash from the one it had meaning it will deem the previous block invalid.