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EC-COUNCIL EC-Council Blockchain Fintech CertificationB|FC exam Sample Questions (Q17-Q22):

NEW QUESTION # 17
__________ is the process of converting rights to an asset into a digital representation on a blockchain.

A. Cryptomining
B. Tekenization
C. Proof of Work
D. Proof of Stake

Answer: B

Explanation:
Tokenizationis the process of converting rights to an asset into a digital representation on a blockchain. This process allows assets like real estate, art, or securities to be represented as digital tokens that can be traded or transferred on a blockchain.
Key Details:
* Digital Representation of Assets: Tokenization involves creating digital tokens on a blockchain that represent ownership or rights to a real-world asset. These tokens can be transferred and traded much like traditional assets.
* Advantages of Tokenization: By enabling fractional ownership, tokenization lowers barriers to investment and improves liquidity. It also provides transparency and traceability in asset transactions.
* Use Cases: Tokenization is widely used in real estate, art, and securities, as it facilitates easy transfer, enhances liquidity, and enables global access to traditionally illiquid assets.
Thus,D. Tokenizationis the correct answer, as it describes the process of converting asset rights into a digital form on a blockchain.

NEW QUESTION # 18
________is used to split up the tasks into multiple chunks that are then processed by multiple nodes.

A. Partitioning
B. Fragmenting
C. Sharding
D. Parsing

Answer: C

Explanation:
Shardingis a scalability technique that splits tasks or data into smaller, more manageable pieces called
"shards." These shards are then processed in parallel by multiple nodes in a network. By dividing the workload, sharding can significantly enhance the efficiency and speed of blockchain networks, which is especially beneficial for handling large transaction volumes and complex computations.
Key Details:
* Purpose of Sharding: The main goal of sharding is to address blockchain scalability issues. By enabling the network to process transactions and data in parallel, it reduces the load on individual nodes, thus increasing the overall throughput of the blockchain.
* How Sharding Works: In a sharded blockchain, each node only needs to process a portion of the total data rather than every single transaction on the network. Each shard is responsible for a subset of data and transactions, and only nodes within a particular shard need to validate its transactions.
* Relevance in Blockchain: Sharding is crucial in large-scale blockchain networks like Ethereum, where high transaction volumes can lead to congestion. Ethereum 2.0, for example, incorporates sharding as a core feature to improve its scalability and transaction processing capacity.
Sharding is, therefore, the correct answer, as it directly refers to the method of dividing tasks for parallel processing in a distributed environment.

NEW QUESTION # 19
________are computer programs which facilitate transaction automation and eliminates the need for intermediaries

A. Distributed Ledgers
B. Smart contracts
C. Ledgers
D. Blockchains

Answer: B

Explanation:
Smart Contractsare self-executing programs that automate transactions and eliminate the need for intermediaries. They operate on blockchain networks and are coded to execute specific actions when predetermined conditions are met.
Key Details:
* Transaction Automation: Smart contracts automatically execute the terms of a contract once the agreed-upon conditions are fulfilled. This reduces manual processing and ensures transparency and trust between parties.
* Elimination of Intermediaries: By running on a decentralized network, smart contracts eliminate the need for third-party intermediaries, such as lawyers or notaries, reducing transaction costs and increasing efficiency.
* Application Across Industries: Smart contracts are used in various sectors, from finance and supply chain to insurance and real estate, due to their ability to enforce terms without human intervention.
Therefore,D. Smart contractsis the correct answer, as they facilitate automated transactions and remove the need for intermediaries.

NEW QUESTION # 20
When you purchase bitcoins, how are they stored?

A. As a file
B. In a bitcoin wallet
C. In an exchange
D. As a hash

Answer: B

Explanation:
When you purchase bitcoins, they are storedin a bitcoin wallet. A bitcoin wallet is a digital tool that stores the cryptographic keys necessary to access and manage your Bitcoin holdings. It does not store physical bitcoins but instead holds the keys to access them on the blockchain.
Key Details:
* Functionality of Bitcoin Wallets: Bitcoin wallets manage private and public keys. The private key is required to sign transactions, while the public key generates addresses that allow for receiving bitcoins.
Without access to the private key, the user cannot spend or transfer their bitcoins.
* Types of Bitcoin Wallets: Wallets can be software-based (such as mobile or desktop apps) or hardware- based (physical devices like a Ledger or Trezor). There are also online (custodial) wallets provided by exchanges, but these still technically store bitcoins within a wallet.
* Not a Physical Storage: Bitcoins do not exist as physical files or objects. The wallet is an interface that interacts with the blockchain, where the actual records of ownership are maintained.
Thus,D. In a bitcoin walletis the correct answer, as bitcoins are stored in wallets that hold the keys necessary to interact with the Bitcoin blockchain.

NEW QUESTION # 21
______is a computer program that runs stop a blockchain and embedded within it are governance and business logic rules

A. DAC
B. copyright
C. DaS
D. DAO

Answer: B

Explanation:
Decentralized Applications (copyright)are applications that run on a blockchain network and include embedded governance and business logic rules. Unlike traditional applications, copyright are decentralized, meaning they operate on a peer-to-peer network rather than a centralized server, leveraging smart contracts to automatically enforce rules and protocols without intermediaries.
Key Details:
* Characteristics of copyright: copyright are open-source, operate autonomously, and store data on a blockchain. They utilize smart contracts to handle various functions, from transaction processing to enforcing governance rules and executing business logic.
* Smart Contracts: The embedded rules within copyright are typically coded as smart contracts, which are self-executing contracts with the terms of the agreement directly written into lines of code. This ensures that all transactions and operations within the Dapp are transparent, immutable, and automatically enforced.
* Use Cases: copyright are commonly found in areas such as decentralized finance (DeFi), gaming, supply chain management, and social media, offering users more control and transparency compared to traditional applications.
In conclusion,copyright (A)is the correct answer as it refers to computer programs running on a blockchain with embedded governance and business logic rules.

NEW QUESTION # 22
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