Cryptographic Principles and Their Role in Blockchain BBLC Practice Questions (Page 8)

Questions 36–40

1. 36expert · hard

   A decentralized identity platform allows users to prove they own a digital credential without revealing the credential itself. The platform uses public-key cryptography. Which mechanism best achieves this?

   • AProviding a hash of the credential
   • BEncrypting the credential with the user's public key
   • CA digital signature over a random challenge using the user's private key
   • DRevealing the user's private key to the verifier
   Reveal Solution Discussion Select an answer first
2. 37application · medium

   A supply-chain consortium records each shipment's event data (e.g., temperature readings, location checkpoints) as transactions in a blockchain. To reduce on-chain storage, they want to store only a single hash per shipment that represents all events. However, auditors need to verify that a specific temperature reading was not tampered with without downloading the entire shipment history. Which approach best satisfies this requirement?

   • AStore a SHA-256 hash of the concatenated list of all events in chronological order.
   • BEncrypt each event with the auditor's public key and store the encrypted events on-chain; auditors decrypt to verify.
   • CUse a digital signature over the entire event list and store the signature on-chain; auditors verify the signature to confirm the list is unchanged.
   • DBuild a Merkle tree from the event hashes and store only the Merkle root on-chain; provide auditors with the Merkle proof for the specific reading.
   Reveal Solution Discussion Select an answer first
4. 38application · medium

   A blockchain network uses proof-of-work. The network's average block time has decreased significantly because more miners joined. To restore the target block time, what should the network do?

   • AReduce the nonce range to make mining harder
   • BIncrease the difficulty target, requiring miners to find a hash below a smaller number
   • CIncrease the block size limit to allow more transactions per block
   • DDecrease the difficulty target, making it easier to find a valid block
   Reveal Solution Discussion Select an answer first
5. 39application · medium

   A company is deploying a permissioned blockchain for supply chain tracking. Each participant (e.g., manufacturer, distributor, retailer) has a key pair. They need to ensure that only authorized participants can add new records and that the records cannot be altered by unauthorized parties. What should they implement?

   • ARequire each record to be signed with the participant's private key, and have other nodes verify the signature using the participant's public key.
   • BHash each record and store the hash on-chain; participants verify the hash matches the record.
   • CEncrypt each record with the participant's public key and store the encrypted record on-chain.
   • DUse a shared symmetric key among all participants to sign records.
   Reveal Solution Discussion Select an answer first
6. 40application · medium

   A cryptocurrency exchange is implementing a custody solution for customer funds. They want to ensure that private keys are protected even if the exchange's primary servers are compromised. They also need to allow for recovery if a key is lost. Which key management strategy best meets these requirements?

   • AUse a multi-signature wallet where multiple parties hold different key shares, and store backup seed phrases in geographically distributed secure locations.
   • BStore all private keys in a single hardware security module (HSM) with strong access controls.
   • CEncrypt the private keys with a password and store them on the exchange's cloud storage for easy access.
   • DGenerate keys on a secure offline computer and store the seed phrase in a bank vault.
   Reveal Solution Discussion Select an answer first