Chapter A1 Flashcards
What is blockchain?
decentralized, continuously growing list of records shared across a peer-to-peer network
linked and secured using cryptography
How does the simplified blockchain process work?
chain
processing
information
every computer in
the peer-to-peer
network locks in
at the same time
creating a consensus-based
permanent, hard to alter
digital record
How does a traditional, centralized network structure operate?
Parties want to connect with the centralized server and send queries to request the required information
This structure has one singular point of failure.
What is a public blockchain?
Also called permissionless or open blockchains
• Dispose of the middlemen; accessible by anyone with a computer & internet access
• Purely decentralized
• E.g. Ethereum, Bitcoin
What is a private blockchain?
Also called permissioned or closed blockchains
• Permission network with a restricted group of known and trusted participants
• Used for internal processes within companies – or for processes between a limited
set of companies
• E.g. Hyperledger Fabric, Ripple, Quorum
What are the basic principles behind blockchain technology?
Distributed
Database
Peer-to-Peer
Transmission
Transparency with
Pseudonymity
Irreversibility
of Records
Computational
Logic
Transaction
Speed
What is Distributed Database?
The ledger is replicated in a large number of identical
databases. Each participant in a blockchain has access to the entire database and
no single participant controls the data or the information. Transaction records of
a partner can be verified directly without a need for third-party intermediaries.
What is Peer to Peer Transmission?
Communication occurs directly between peers
without the need for central coordination. Peer nodes simultaneously func-
tioning as both “clients” and “servers” to the other nodes on the network
What is Transparency with Pseudonymity?
Transactions occur between blockchain
addresses and are visible to anyone with access to the system. When changes are
entered in one copy, all other copies are simultaneously updated. Users on a
blockchain have a unique alphanumeric address that identifies them. Users can
remain anonymous or provide proof of their identity to others.
What is the Irreversibility of Records?
Once a transaction is entered in the database, the
records cannot be altered. Various computational algorithms are deployed to
ensure that the recording on the database is permanent and available to all others
on the network.
What is Computational Logic?
The digital nature of the ledger means that users can
set up algorithms and rules that automatically trigger transactions between
nodes.
What is Transaction Speed?
Transactions on the blockchain-based system are com-pleted and verifiable within seconds without human intervention.
What is a Hybrid Blockchain?
This type of blockchain offers the benefits of both public
and private blockchains. Hybrid blockchain consists of the public blockchain
(that all participants are a part of) and a private network (permission or invitation-
based) that restricts participation. Highly regulated enterprises and governments
can benefit from a hybrid blockchain. The technology enables flexibility and
control over what data is kept private versus shared on a public ledger. There are
several real-life examples of hybrid blockchain. For example, XinFin is a hybrid
blockchain built on both Ethereum (a public blockchain), and Quorum (a private
blockchain).
What is the name of the Whitepaper produced by Pseudonym Satoshi Nakamoto?
“Bitcoin: a peer-to-peer
Electronic Cash System“
True/False: In a decentralized peer-to-peer network structure all downloaders are also uploaders.
True
