School of Electrical Engineering and Computer Science

National University of Sciences & Technology (NUST)

Quiz 2

Subject: Cryptocurrencies & the blockchain Marks : 15

Course: Time: 15 Minutes
Instructor: Taha Ali Date: __________

Name.…………………………. Registration No…………………………

___________________________________________________________

1. Which primitive is considered the Swiss Army knife of cryptography and why? [2 marks]

Hash functions are considered the Swiss Army Knife of cryptography because they have a key role in multiple
different security and cryptography applications.

2. Give three examples of how Bitcoin is decentralized along with a one-sentence explanation for each. [5
marks]

1. There is no central authority in the Bitcoin ecosystem analogous to a clearing house which verifies or
processes transactions.

2. There is no central bank in Bitcoin which is tasked with currency creation. Instead new coins are created
as per rules defined in a decentralized algorithm.

3. The rules which govern the Bitcoin network can only be changed by consent of the majority of the
network users.

3. Give three examples of how Bitcoin has become centralized along with a one-sentence explanation for each.
[5 marks]

1. Mining has become heavily centralized due to concentration of mining equipment and
emergence of mining pools.

2. Bitcoin exchanges can act as centralized interfaces with traditional currencies.

3. Certain developers and personalities are influential in the Bitcoin community.

4. List three different domains (besides cryptocurrencies) where the blockchain can be deployed for
fundamental improvements, along with a one line explanation of how. [3 marks]

1. Elections: blockchain can be used to store votes and prevent unauthorized tampering.

2. Land Records: blockchain is being used to secure and share land records in many countries to
enable transparency and fight corruption.

3. Educational Records: blockchain can be used to prevent retroactive tampering as is often

observed in case of fake credentials.