Public and Private Ledgers

Public and Private Ledgers >> Introduction to Blockchain Technologies

On a public blockchain, ownership of an asset is attributed to an address, which is pseudonymous. On a private blockchain, ownership attribution may or may not be pseudonymous; the identity setup is a design decision.

On a public blockchain, ownership of an asset is attributed to a self-selected username, which may or may not be pseudonymous. On a private blockchain, ownership attribution is indicated using a company’s ticker symbol.

On both public and private blockchains, ownership of an asset is attributed to a private key. On a public blockchain, private keys remain hidden from the network, whereas on a private blockchain, companies must disclose their private keys as part of their reporting requirements.

None of the above

Correct: The identity setup of a private or consortium blockchain is a design choice.

A centralized ledger can be backed-up, whereas a distributed ledger cannot.

A centralized ledger is more resilient to hardware failure compared to a distributed ledger.

In a centralized ledger all data is stored in a single location, whereas in a distributed ledger fragments of the full dataset are spread across across multiple locations.

A centralized ledger is controlled by a single, highly-trusted entity, whereas a distributed ledger is controlled by multiple, independent nodes who each retain a full copy of the ledger.

Correct: In a distributed ledger, control is distributed amongst the nodes in the network.

Anyone can view the ledger.

Anyone can become a network node.

Anyone can enter records on the ledger.

All of the above

Only the first two options are correct.

Correct: On a public blockchain, anyone can view the ledger, become a network node, and enter records on the ledger.

A firm or consortium of firms controls who can view the ledger.

A firm or consortium of firms controls who can become a network node.

A firm or consortium of firms controls who can enter records on the ledger.

All of the above

Only the second and third options are correct.

Correct: With a permissioned blockchain, a firm or consortium of firms controls who can view the ledger, who can become a network node, and who can enter records on the ledger.

Permissionless

Trustless

Open

All of the above

None of the above

Correct: A private distributed ledger is permissioned, requires some degree of trust, and is not open to the public.

In principle, all transactions are traceable with attribution of assets to identifiers (e.g. addresses).

In principle, anyone with access to the blockchain can decrypt any of its encrypted data.

In principle, the real-world identities corresponding to each identifier (address) are known.

In principle, only nodes with verified identities can join the network.

Correct: On a public blockchain these identifiers (addresses) are pseudonymous. On a private blockchain, these identifiers may or may not be pseudonymous.

private key

zero-knowledge proof

total-knowledge proof

probabilistic proof

Correct: A zero-knowledge proof enables one party prove to another party that they know a value, x, without revealing x itself (or any additional information).

zk-SNARK

consortium blockchain

classic exchange wallet

hierarchical deterministic (HD) wallet

Correct: An HD wallet algorithmically generates a new public/private key pair for every transaction, based on a single master seed key.

It can’t; implementing blockchain technology would actually increase the asymmetry of information between a firm and its shareholders.

By providing shareholders with a fully traceable record of the firm’s business dealings (e.g. asset ownership, transactions, and contracts), provided that the firm’s addresses are fully disclosed.

By allowing the firm to selectively disclose a subset of its information in order to build a good reputation.

By providing shareholders with intermittent accounting reports which have been certified by a trusted third party.

Correct: Blockchain has a high native level of transparency, which can help reduce information asymmetries.

A dictator wants to conceal the corruption in his government’s land title registry.

A medical lab wants to have exclusive write-access for recording patient records.

A financial institution wants to leverage the network effects and cryptographic auditing capabilities of a blockchain, however they are required by law to follow KYC/AML regulations.

All of the above

Correct: The R3 Consortium is an example of this.

Public and Private Ledgers >> Introduction to Blockchain Technologies

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