A blockchain consortium is planning to upgrade its consensus mechanism to improve scalability. They are concerned about the risk of a hard fork that could split the network. What is the most effective way to manage this risk?

Implement the upgrade without prior notice

Use a backward-compatible soft fork

Rely on a single developer to decide

A global bank is planning to issue a stablecoin on a blockchain. They need to comply with data protection regulations that require the ability to erase personal data upon request. However, the blockchain's immutability makes this difficult. Which consensus-related design choice would best enable compliance?

Use a public blockchain with pseudonymous addresses

Use a permissioned blockchain with a governance mechanism that allows for the redaction or off-chain storage of personal data

Use a Proof of Work blockchain with high hash rate

Use a Proof of Stake blockchain with a large validator set

Which consensus mechanism is often chosen for permissioned financial networks because it offers high efficiency but requires a trusted set of validators, thus sacrificing decentralization?

Delegated Proof of Stake (DPoS)

Practical Byzantine Fault Tolerance (PBFT)

Which consensus mechanism is designed to significantly reduce energy consumption compared to Proof of Work, by replacing computational work with a financial stake?

Practical Byzantine Fault Tolerance (PBFT)

Delegated Proof of Stake (DPoS)

A bank is implementing a blockchain for cross-border payments. They must ensure that the consensus mechanism allows for the identification of transaction participants to meet know-your-customer (KYC) regulations. Which consensus mechanism is most suitable?

Delegated Proof of Stake (DPoS) with open delegation

Permissioned Practical Byzantine Fault Tolerance (PBFT)

Permissionless Proof of Work (PoW)

EC-CouncilBlockchain Fintech Certification

Domain 2Objective 6

Challenges in Blockchain Consensus Mechanisms BFC Practice Questions (Page 5)

Part of the Consensus Mechanisms for Financial Systems domain, which makes up ~11% of our current practice bank.

41questions here

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Questions 21–25

21application · medium
A blockchain consortium is planning to upgrade its consensus mechanism to improve scalability. They are concerned about the risk of a hard fork that could split the network. What is the most effective way to manage this risk?
Select an answer first
22expert · hard
A global bank is planning to issue a stablecoin on a blockchain. They need to comply with data protection regulations that require the ability to erase personal data upon request. However, the blockchain's immutability makes this difficult. Which consensus-related design choice would best enable compliance?
Select an answer first
23foundation · easy
Which consensus mechanism is often chosen for permissioned financial networks because it offers high efficiency but requires a trusted set of validators, thus sacrificing decentralization?
Select an answer first
24foundation · easy
Which consensus mechanism is designed to significantly reduce energy consumption compared to Proof of Work, by replacing computational work with a financial stake?
Select an answer first
25application · medium
A bank is implementing a blockchain for cross-border payments. They must ensure that the consensus mechanism allows for the identification of transaction participants to meet know-your-customer (KYC) regulations. Which consensus mechanism is most suitable?
Select an answer first

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