Things I still dont know

Question 1

Disruption

Answer 1

Disruption is a process where new products, services or business models drastically change or replace existing market leaders by not only meeting customer needs in efficient or affordable ways, but predict customer’s future needs too.

Question 2

The payments ecosystem includes

Answer 2

• Card Networks
• Card issuers
• Merchant acquirers
• Processors
• ISO

Question 3

Card Networks

Answer 3

(ex. Visa, Mastercard) who facilitate transactions between consumers, merchants, processors and banks and charge fees based on transaction volume.

Question 4

Card issuers

Answer 4

(banks) issuing payment cards, paying merchant banks and receiving interchange fees (which vary by network, card type, transaction type, merchant bank and risk level)

Question 5

Merchant acquirers

Answer 5

Merchant acquirers enable businesses to accept payments

Question 6

Processors

Answer 6

Processors handling technical payment flows (verify transactions, ensure fund availability and settle funds) and fraud checks.

Question 7

ISO

Answer 7

ISO (Independent Sales Organizations) acting as intermediaries, reselling the services of processors. They get paid the remainder of the merchant discount after the card networks, issuers and merchant acquirers get their cut.

Question 8

Bank transfers ecosystem

Answer 8

funds move via intermediary banks, each taking fees with potential exchange rate losses too.

Question 9

DLT

Answer 9

DLT (Distributed Ledger Technology) is a digital system for recording and sharing data across a network of computers where each participant has a synchronized copy of the ledger.

Question 10

Broadcast nodes

Answer 10

Submit transactions to be verified and stored in the blockchain

Question 11

Merkle Tree

Answer 11

A Merkle Tree is a binary hash tree where leaf nodes are transaction hashes, producing a single Merkle Root.

Question 12

Nonce

Answer 12

The nonce is a 64-bit integer miners adjust to find the PoW hash with the required amount of leading zeroes.

Question 13

Mining

Answer 13

Mining occurs by miners competing to find a block header hash with a specific number of leading zeroes. PoW establishes objective rules for block validation and transaction integrity

Question 14

If two miners mine a block simultaneously

Answer 14

It forks and the longest branch wins.

Question 15

Why is a Merkle Tree secure

Answer 15

as any change in transactions (tampering) alters the Merkle Root, invalidating the block’s PoW hash and breaking integrity.