Ans-1 What is needed is an electronic payment system based on

cryptographic proof instead of trust, allowing any two willing parties

to transact directly with each other without the need for a trusted
third party. Transactions that are computationally impractical to
reverse would protect sellers from fraud, and routine escrow
mechanisms could easily be implemented to protect buyers The first
challenge is that of Ownership. While ownership of fiat currency
(rupees, dollars) is decided by physical possession or bank account
entry, that of digital currency is determined by the validation of
possession of spending credentials in digital form. The second
challenge is to provide a single source of truth regarding the amount
of virtual currency owned by an entity.

Ans-2 It Does Not Completely Solve Bitcoin’s Transaction Fee

Problem
Lightning Network is often touted as a solution to the problem of bitcoin’s rising
transaction fees. Its proponents claim that transaction fees, which is one of the
direct consequences of Bitcoin’s clogged network, will come down after the
technology takes transactions off the main blockchain

Remaining Online at All Times Makes Nodes Susceptible

Nodes on Bitcoin’s lightning network are required to be online at all times in order to
send and receive payments. Since the parties involved in the transaction must be
online and they use their private keys to sign in, it's possible that the coins could be
stolen if the computer storing the private keys was compromised

Bitcoin's Price Fluctuations

The advent of Lightning Network is also supposed to herald Bitcoin’s viability as a
medium for daily transactions. Customers are able to open payment channels with
businesses or people that they transact with frequently. For example, they can open
payment channels with their landlord or favorite e-commerce store and transact
using bitcoins.

Ans-3 Forthe purposes of this article, we will mainly look to Bitcoin's

blockchain when discussing aspects of blockchain architecture in
general. However, the architectural components
of transactions, blocks, mining, and consensus can be generalized
and implemented in many different ways, leading to various possible
blockchain projects. These projects usually involve creating other
cryptocurrencies (or alt-coins), but the diTransactions contain one-
or-more inputs and one-or-more outputs.
An input is a reference to an output from a previous transaction.
An output specifies an amount and address .
An input always references a previous transaction's output. This
continual pointer of inputs to previous transactions outputs allows
for an uninterrupted, verifiable stream of value (represented by the
bitcoin currency) amongst addresses
versity in blockchain-related project ideas is growing quickly.
Ans-4

In the present work, we analyze the distribution of Bitcoin across

entities of different sizes, taking into consideration addresses that
belong to exchanges and miners as well. We aim to shine more light
on the true underlying distribution of BTC across network
participants, and show that Bitcoin ownership is much less
concentrated than often reported – and has in fact seen a dispersion
over the years. In addition, we demonstrate that over the course of
the past year the BTC supply held by whale entities has considerably
increased, suggesting an inflow of institutional investors.

Ans -5 Blockchain network is by its very nature decentralized.

Because of this, Bitcoin and other forms of cryptocurrencies don’t
need a centralized or third-party authority like a bank or financial
institution to preside over the network and its transactions. Instead,
everyone using the blockchain network monitors everyone else and
verifies transactions.
Note that, under this system, the actors in the blockchain network
don’t need to know each other’s identities in real life. Furthermore,
cryptographic protocols ensure the privacy of personal information
and that chain verification records are legitimate.
These cryptographic protocols are so complex that it would take
even the most advanced supercomputers many centuries to break
them by force. Because of this, Bitcoin’s network is very resilient to
hacking attacks.
Ultimately, it would be very difficult to compromise or cheat on the
Bitcoin blockchain network because of its inherently decentralized,
encrypted structure.

Ans-6 It was coming towards the end of February, 2014. Uncertainty

culminated over a new found exuberance towards a digital currency
– known as Bitcoins – when Mt. Gox, the biggest Bitcoin Exchange in
Japan collapsed. Leaked corporate documents pointed the cause of
collapse to hackers, who caused some hundreds of thousands
of Bitcoins to evaporate from the exchange. Fears of people who
doubted Bitcoins’ legitimacy and security had been confirmed: it was
no other than another form of technological innovation susceptible
to hackers’ maleficence. The CEO of Mt. Gox, Mark Karpeles, said at
the press conference thereafter while announcing Mt. Gox’s
bankruptcy that “we had weaknesses in our system, and our Bitcoins
vanished. We’ve caused trouble and inconvenience to many people,
and I feel deeply sorry for what has happened.”