BlockChain Technologies

UNIT-2
1. Define a hash function and its properties. Describe how hash functions ensure
data integrity in Blockchain?

Hashing is a process used in computer science and cryptography to convert data of arbitrary
size into a fixed-size value or hash code. The primary purpose of hashing is to quickly and
efficiently retrieve or compare data. Instead of searching through an entire dataset or
comparing large amounts of data directly, you can use a hash function to generate a fixed-length
hash code that represents the original data.
A cryptographic hash function combines hash function message-passing capabilities with
security features. The original data cannot be recovered through decryption after conversion
since the algorithm is a one-way cryptographic function.

Properties of Hash Functions:

Collision resistant
Give two messages m1 and m2, it is difficult to find a hash value such that hash(k, m1) = hash(k,
m2) where k is the key value.
Preimage resistance
Given a hash value h, it is difficult to find a message m such that h = hash(k, m).
Second preimage resistance
Given a message m1, it is difficult to find another message m2 such that hash(k, m1) = hash(k,
m2).
Large output space
The only way to find a hash collision is via a brute force search, which requires checking as
many inputs as the hash function has possible outputs.
Deterministic
A hash function must be deterministic, which means that for any given input a hash function
must always give the same result.
Avalanche Effect
This means for a small change in the input, the output will change significantly

Hash functions ensure data integrity in Blockchain

 Hashing facilitates the generation of cryptographic signatures, which aid in the identification
of genuine transactions.
 On the blockchain, hashing facilitates transaction tracking. Instead of looking for a
transaction, it is easier to copy the hash into a blockchain explorer where you may examine
the transaction details.
 Hash functions, which condense the data into a small value while maintaining its integrity,
are a crucial component of digital signature algorithms.
 Blockchain transactions and blocks are authenticated and data integrity is maintained via
digital signatures.
 Hashing functions are crucial to crypto mining
2. Discuss about different types of Blockchain in detail.

There are four types of Blockchain

1. Public Blockchain
2. Private Blockchain
3. Consortium Blockchain
4. Hybrid Blockchain

Public Blockchain

• Public blockchains are open and permissionless networks where anyone can
participate, validate transactions, and contribute to the consensus process.
• These blockchains are decentralized, meaning they don't rely on a single entity for
control or decision-making.
• Public blockchains typically use a cryptocurrency as an incentive mechanism to reward
participants who perform tasks like mining or validating transactions.
• They provide transparency and immutability since anyone can verify transactions and
access the entire transaction history stored on the blockchain.
• Public blockchains are suitable for applications that require openness, transparency,
and trustless environments, such as decentralized finance (DeFi), tokenized assets, and
public voting systems.

Features of Public Blockchain

 High Security
 Open Environment
 Anonymous Nature
 No Regulations
 Full Transparency
 True Decentralization
 Full User Empowerment

Disadvantages
 Heavy energy consumption required to maintain them. The concern is a consensus
mechanism that requires participants to compete to validate the information and
receive a reward for letting the network use their processing power.
 Lack of complete privacy and anonymity. Public blockchains allow anyone to view
transaction amounts and the addresses involved. If the address owners become known,
the user loses their anonymity.
 Most public blockchains are designed for cryptocurrencies, which by nature of their
value are a prime target for hackers and thieves.

Private Blockchain
 Private blockchains, also known as permissioned blockchains, are restricted networks
where participation and access are controlled by a central authority or a group of trusted
entities.
 They require permission to join, and participants are typically known and vetted.
  Private blockchains often have a centralized governance model, allowing the controlling
entity to define the rules and consensus mechanisms.
 Examples of private blockchain use cases include supply chain management, interbank
transactions, and enterprise solutions.
 Private blockchains may or may not utilize a cryptocurrency or token, as they prioritize
confidentiality and controlled access over the open participation found in public
blockchains.
 While private blockchains provide some level of transparency within the network, they
often limit public visibility to specific authorized parties.
 Private blockchains are advantageous for situations where privacy, efficiency, and
scalability are essential, and a trusted network of participants exist

Features of Private Blockchain

Full Privacy
 It focus on privacy concerns.
 Private Blockchain are more centralized.
High Efficiency and Faster Transactions
When you distribute the nodes locally, but also have much less nodes to participate in
the ledger, the performance is faster.
Better Scalability
Being able to add nodes and services on demand can provide a great advantage to the
enterprise.
Empowering Enterprises
Stability

Disadvantages
private blockchains lose out on many of the valuable attributes of permissionless systems
simply because they are not widely applicable. They are instead built to accomplish specific
tasks and functions.

Consortium Blockchain
A consortium blockchain is a combination of multiple private blockchains belonging to
different organizations, where each of them forms a node on the chain as a stakeholder in
the alliance — and can only leave or join the network with the authorization of the
stakeholders.

Features of Consortium Blockchain

 Data Privacy
 Rapid-Fire Transaction
 Regulations and Rules
 Zero Probability of 51% Act

Disadvantages
Limited Transparency ad Governance Challenge.

Hybrid Blockchain
A type of blockchain technology that combines elements of both private and public blockchain.
It lets organizations set up a private, permission-based system alongside a public
permissionless system, allowing them to control who can access specific data stored in the
blockchain, and what data will be opened up publicly.
 Typically, transactions and records in a hybrid blockchain are not made public but can be
verified when needed, such as by allowing access through a smart contract. Confidential
information is kept inside the network but is still verifiable. Even though a private entity may
own the hybrid blockchain, it cannot alter transactions.

When a user joins a hybrid blockchain, they have full access to the network. The user's identity
is protected from other users, unless they engage in a transaction. Then, their identity is
revealed to the other party.

Disadvantages.
This type of blockchain isn't completely transparent because information can be shielded.
Upgrading can also be a challenge, and there is no incentive for users to participate or
contribute to the network.

3. Summarize the Concept of Public Accessibility in Public Blockchain.

Public Blockchain

• Public blockchains are open and permissionless networks where anyone can
participate, validate transactions, and contribute to the consensus process.
• These blockchains are decentralized, meaning they don't rely on a single entity for
control or decision-making.
• Public blockchains typically use a cryptocurrency as an incentive mechanism to reward
participants who perform tasks like mining or validating transactions.
• They provide transparency and immutability since anyone can verify transactions and
access the entire transaction history stored on the blockchain.
• Public blockchains are suitable for applications that require openness, transparency,
and trustless environments, such as decentralized finance (DeFi), tokenized assets, and
public voting systems.

Features of Public Blockchain

 High Security
 Open Environment
 Anonymous Nature
 No Regulations
 Full Transparency
 True Decentralization
 Full User Empowerment

Examples
• Bitcoin: The first and most well-known blockchain, primarily used for peer-to-peer
electronic cash transactions.
• Ethereum: A blockchain that supports smart contracts and decentralized applications
(DApps) in addition to cryptocurrency transactions.

Public Blockchain Use Cases

• Cryptocurrencies and Tokens: Public blockchains like Bitcoin and Ethereum serve as
platforms for cryptocurrencies and tokens. They enable decentralized digital currencies,
peer-to-peer transactions, and programmable smart contracts.
 • Public Voting Systems: Public blockchains can provide transparent and auditable
voting systems. They can enable secure and verifiable elections by recording votes on
the blockchain, ensuring transparency, immutability, and resistance to manipulation.
• Tokenized Assets: Public blockchains can tokenize various real-world assets like real
estate, art, or commodities. This allows for fractional ownership, increased liquidity, and
transparent transfer of assets, creating new opportunities for investment and asset
management.
• Distributed Applications (DApps): Public blockchains support the development and
deployment of decentralized applications. These applications leverage the blockchain's
distributed nature, immutability, and smart contract capabilities to create various
solutions such as decentralized social networks, gaming platforms, and prediction
markets.

4. Discuss any one Use Case of a Blockchain.

Blockchain technology is not always the easiest to understand, and the topic is further
complicated with specific terminology and references to the minutiae of the system. So
whether or not you know what a merkle tree is, taking a look at the basics of the system
can provide insight as to why this technology is so fascinating.

Blockchain technology acts as a distributed ledger and a decentralized database for

permanent storage. There is no traditional oversight mechanism. Instead, blocks of data are
created, verified through various methods, and added to a chronological chain that builds
upon all previous transactions or data. It’s a system that excels in situations where
transparency, security, and multi-party tracking are necessary.

Blockchain platforms offer users security in a complicated encryption process known as

hashing. Users have tools called public and private keys that allow exclusive access to the
private trades, transactions, documents, and data sent over blockchain networks.

Blockchain use cases in the supply chain

As blockchain systems support and encourage transparent oversight, any company that
produces or sells goods that depend on other materials or labor could benefit. Data tracking
with comprehensive oversight in an immutable record lends itself to supply chain
management and logistics.

Supply chains—besides being responsible for bringing you everything in your life from your
tomatoes to your phone to your dinner table—are incredibly difficult to manage. Detailed
records must be preserved and safeguarded in tamper-free environments to ensure that
each raw material makes it across locations and through each stage of the manufacturing
process to become a completed, sellable product.

Bottlenecks have the potential to be disastrous in supply chain management. Paperwork can
be expensive and inefficient, and goods can be mislabeled or sourced unethically. This is
where blockchain tech comes in, streamlining and automating the supply chain process,
increasing transparency and time management, and smoothing logistics.

Entries on a blockchain can be used to queue up events with a supply chain — allocating
goods newly arrived at a port to different shipping containers, for example. Blockchain
provides a new and dynamic means of organizing tracking data and putting it to use.
Blockchain technology in banking and finance

International Payments
Blockchain provides a way to securely and efficiently create a tamper-proof log of sensitive
activity. This makes it excellent for international payments and money transfers.

in April 2018, Banco Santander launched the world’s first blockchain-based money transfer
service. Known as “Santander One Pay FX,” the service uses Ripple’s xCurrent to enable
customers to make same-day or next-day international money transfers.

By automating the entire process on the blockchain, Santander has reduced the number of
intermediaries typically required in these transactions, making the process more efficient.

As a large commercial bank, Santander has numerous retail clients who would benefit from
more efficient and cheaper payments, particularly in the area of international transfers.
Blockchain technology can be used to decrease the cost of these transfers by reducing the
need for banks to manually settle transactions.

Blockchain technology in Healthcare

Blockchain in healthcare projects can address some of the biggest challenges that the
healthcare industry faces, such as hospital cybersecurity & transparency, interoperability,
and patient privacy, while saving many costs.

Using this tech improves personal security for users of a given network, and data breaches
are much less likely to happen. Besides, blockchain use cases in healthcare can make many
operations faster and automate many of them, saving healthcare providers and patients
costs.
Patient Data Management

High-Security Standards in Data Encryption

Healthcare Transactions Control
5. Define the terms Public and Private Blockchain and Compare Private and Public
Blockchain.

Public Blockchain

• Public blockchains are open and permissionless networks where anyone can
participate, validate transactions, and contribute to the consensus process.
• These blockchains are decentralized, meaning they don't rely on a single entity for
control or decision-making.
• Public blockchains typically use a cryptocurrency as an incentive mechanism to reward
participants who perform tasks like mining or validating transactions.
• They provide transparency and immutability since anyone can verify transactions and
access the entire transaction history stored on the blockchain.
• Public blockchains are suitable for applications that require openness, transparency,
and trustless environments, such as decentralized finance (DeFi), tokenized assets, and
public voting systems.

Features of Public Blockchain

 High Security
 Open Environment
 Anonymous Nature
 No Regulations
 Full Transparency
 True Decentralization
 Full User Empowerment

Private Blockchain
 Private blockchains, also known as permissioned blockchains, are restricted networks
where participation and access are controlled by a central authority or a group of trusted
entities.
 They require permission to join, and participants are typically known and vetted.
 Private blockchains often have a centralized governance model, allowing the controlling
entity to define the rules and consensus mechanisms.
 Examples of private blockchain use cases include supply chain management, interbank
transactions, and enterprise solutions.
 Private blockchains may or may not utilize a cryptocurrency or token, as they prioritize
confidentiality and controlled access over the open participation found in public
blockchains.
 While private blockchains provide some level of transparency within the network, they
often limit public visibility to specific authorized parties.
 Private blockchains are advantageous for situations where privacy, efficiency, and
scalability are essential, and a trusted network of participants exist

Features of Private Blockchain

Full Privacy
 It focus on privacy concerns.
 Private Blockchain are more centralized.
High Efficiency and Faster Transactions
 When you distribute the nodes locally, but also have much less nodes to participate in
the ledger, the performance is faster.
Better Scalability
Being able to add nodes and services on demand can provide a great advantage to the
enterprise.
Empowering Enterprises
Stability
Comparison between Private and Public Blockchain.
6. What is a Hash Puzzle? Explain the Purpose of Hash Puzzles in Blockchain
Mining.
A hash puzzle is a type of cryptographic puzzle that is used in blockchain networks to verify the
validity of transactions. Hash puzzles are typically solved by miners, who use specialized
hardware to try different values until they find one that produces a hash with certain
properties.

Hash puzzles are used in blockchain networks because they are very difficult to solve but very
easy to verify. This means that it is very difficult for someone to cheat the system by trying to
submit invalid transactions, but it is very easy for the network to verify that a transaction is
valid once it has been solved.
The most common type of hash puzzle used in blockchain networks is the proof-of-work (PoW)
puzzle. In a PoW puzzle, miners try to find a value, called a nonce, that, when added to the
block's header, produces a hash with a certain number of leading zeros. The first miner to find
a nonce that satisfies this condition is awarded a reward for their work, and the block is added
to the blockchain.
Hash puzzles are a key part of the security and integrity of blockchain networks. They help to
ensure that transactions are valid and that the blockchain cannot be tampered with.

Since the hash function used in cryptocurrencies, such as SHA-256 in Bitcoin, is deterministic,
finding a nonce that results in a desired hash value requires a trial-and-error approach. Miners
must perform numerous computations, changing the nonce each time, until they find a valid
solution that satisfies the specified criteria. This process is resource-intensive and requires
substantial computational power.
Hash puzzles serve several important purposes:
• Consensus Mechanism: By making the process of finding a valid solution difficult and
resource-intensive, hash puzzles provide a way to establish consensus among participants
in a decentralized network. Miners invest computational power to compete for the right to
create new blocks, ensuring that only valid and legitimate transactions are added to the
blockchain.
• Block Creation and Reward Distribution: Hash puzzles incentivize miners to contribute
their computational resources to secure the network and maintain the blockchain. Miners
are rewarded with cryptocurrency tokens for successfully solving the hash puzzle and
adding new blocks to the chain.
• Block Time and Blockchain Stability: The difficulty of the hash puzzle can be adjusted
dynamically to regulate the block creation rate and maintain a stable blockchain. This
adjustment helps ensure that blocks are added at a consistent pace and prevents the
blockchain from growing too rapidly or too slowly.

7. Discuss how Digital Identity Verification is implemented using Blockchain

Technology

Identity Management
Identity management is the framework of processes, policies, and technologies to ensure that
only authorized people have access to technology resources, information, or services.
A digital identity is the total information about an individual or organization that exists online.
Data that forms a digital identity includes usernames, buying history, ID number, and search
history.
Almost all of our digital identities are connected through devices, services, and apps that have
dominantly used centralized and federated identity systems
 There are a number of blockchain-based digital identity verification solutions currently
being developed, including:
• Self-sovereign identity: This is a system where individuals control their own identity data
and can share it with third parties as needed. This can help to improve privacy and security,
as individuals can choose who they share their data with.
• Decentralized identifier (DID): A DID is a unique identifier that can be used to represent a
person or entity on the blockchain. DIDs can be used to create verifiable credentials, which
are digital certificates that can be used to prove identity or other attributes.
• Blockchain-based biometrics: Biometric authentication, such as fingerprint scanning or
facial recognition, can be used to verify identity on the blockchain. This can be a more secure
way to verify identity than traditional methods, such as passwords and PINs.

Decentralized Identifiers (DIDs)

 Decentralized identifiers (DIDs) are a way to identify yourself on the internet without
using a central authority, like a government or a company.
 With a DID, you can prove who you are in online without having to give your personal
information to a bunch of different websites or apps.
 It's like a digital version of a driver's license that can only be used by the person it's issued
to.
 W3C describes DID as being “A new type of identifier that enables verifiable, decentralized
digital identity.”

Key features of DIDs

 Organizations and individuals have full control and ownership over their DIDs and no
party can take them away
 Enable the owner to prove cryptographic control of them
 Don’t contain personal data or wallet information
 Enables private and secure connections between two parties and can be verified anywhere
at any time
DIDs can be used in the same way where people can create as many DIDs as they want for
different purposes.
For example, you can have a DID for different interactions:
DID 1: Online gaming sites
DID 2: For educational and training credentials such as a university degree, Project
Management Certificate, and health and safety training certificate
DID 3: To hold different types IDs like state ID and driver’s license
DID 4: Online shopping websites
DID 5: Crypto investment platforms and services

Verifiable Credentials (VCs)

Verifiable Credentials are a digital, cryptographically secured version of both paper and
digital credentials that people can present to organizations that need them for verification.
Identity documents like passports, IDs issued by the government, and driver’s licenses can
be issued as Verifiable Credentials.
Each DID can have multiple Verifiable Credentials associated with them that are digitally
(cryptographically) signed by their issuers like a government driver’s licensing department.
DID owners store the credentials themselves on their phones and don’t have to rely on a
single provider like Facebook or Google.
How Blockchain identity management works

Benefits of Blockchain Identity Solutions for Users

 Consent to share identity data
 Secure global ID
 Complete data ownership and control
 Decentralized data storage
 Reduces the need for paper-based identity management

8. Explain the Concept of Non Fungible Token in the Context of Blockchain.

• NFTs (non-fungible tokens) are unique cryptographic tokens that exist on a

blockchain and cannot be replicated.
• NFTs can represent digital or real-world items like artwork and real estate.
• "Tokenizing" these real-world tangible assets makes buying, selling, and trading them
more efficient while reducing the probability of fraud.
• NFTs can represent individuals' identities, property rights, and more.
• Collectors and investors initially sought NFTs after the public became more aware of
them, but their popularity has since waned.
• NFTs trade via blockchain technology and represent real-world commodities, such as
art, real estate, avatars, memes, video game skins, and GIFs. People buy and sell these
assets

How NFTs Work

NFTs are created through a process called minting, in which the information of the NFT is
recorded on a blockchain. At a high level, the minting process entails a new block being
created, NFT information being validated by a validator, and the block being closed. This
minting process often entails incorporating smart contracts that assign ownership and
manage the transferability of the NFT.
As tokens are minted, they are assigned a unique identifier directly linked to one blockchain
address. Each token has an owner, and the ownership information (i.e., the address in which
the minted token resides) is publicly available.

NFTs shift the crypto paradigm by making each token unique and irreplaceable, making it
impossible for one non-fungible token to be "equal" to another.
They are extensible, meaning you can combine one NFT with another to create a third,
unique NFT.
 Examples of NFTs

The most famous use case for NFTs is that of cryptokitties. Launched in November 2017,
cryptokitties are digital representations of cats with unique identifications on Ethereum’s
blockchain.

Each kitty is unique and has a different price. They "reproduce" among themselves and create
new offspring with other attributes and valuations compared to their "parents."

Much of the earlier market for NFTs was centered around digital art

Digital art is a technique used to create any art digitally by using technologies. If these Digital
art is combined with Blockchain Technology for ensuring security and authentication the we
call it as crypto art.

Crypto art is digital art that uses blockchain technology to verify ownership. Just as an original
Matisse can have its authenticity verified, crypto art uses a non-fungible token (NFT) for
verification. The work’s uniqueness is what makes it valuable, because unlike ordinary digital
art that can be easily replicated, crypto art is one-of-a-kind.
How does blockchain add value to digital art
The thing that makes blockchain revolutionary for digital art is the ability to prove authenticity
and scarcity for digital artworks. Before blockchain, a digital artwork could be copied
identically, making it difficult to build a market around digital art.

Authenticity
Blockchain’s ledger technology, which acts as a public record tracking system, makes it possible
for anyone to track the history of an artwork. This allows you (the artist) to show the entirety
of the artwork’s life on this publicly trackable database, therefore proving the authenticity of a
digital artwork in a way that was impossible to do before.

Scarcity
Not only does tracking a digital artwork via blockchain allow you to prove a work is authentic,
but it also allows you to prove its scarcity. Only works that are tracked on the blockchain as
unique tokens are the originals, meaning you can prove which works are original and therefore
create scarcity for your digital pieces

9. What is Blockchain Neutrality. Discuss about the factors that affect Blockchain
neutrality.

• Blockchain neutrality is the principle that all blockchain networks should be treated
equally by regulators and other stakeholders. This means that no single blockchain
network should be given preferential treatment, and that all networks should have the
same opportunities to succeed.

• Blockchain neutrality is important for a number of reasons. First, it helps to ensure that the
market for blockchain technology is fair and competitive. Second, it helps to promote
innovation, as it allows new blockchain networks to enter the market and compete with
existing networks. Third, it helps to protect consumers, as it ensures that they have access
to a variety of blockchain networks to choose from.
 • There are a number of challenges to achieving blockchain neutrality. One challenge is that
different blockchain networks have different features and capabilities. This can make it
difficult to compare different networks and to determine which network is best for a
particular application. Another challenge is that there is a lack of consensus on what
constitutes blockchain neutrality. This can lead to disagreements between regulators,
businesses, and other stakeholders about how to implement blockchain neutrality.

Here are some of the benefits of blockchain neutrality:

• Fairness: Blockchain neutrality ensures that all blockchain networks have the same
opportunities to succeed, regardless of their size or influence. This helps to create a level
playing field for businesses and developers who are building blockchain applications.
• Competition: Blockchain neutrality promotes competition between blockchain networks,
which can lead to innovation and improvement. As networks compete for users and
developers, they are more likely to offer new features and services.
• Innovation: Blockchain neutrality allows new blockchain networks to enter the market
and compete with existing networks. This can lead to the development of new and
innovative blockchain applications.
• Consumer choice: Blockchain neutrality gives consumers the choice of which blockchain
network to use. This can help to ensure that consumers are getting the best possible
service and value.

Factors effecting Blockchain Neutrality

51% Attacks
When a miner or group of miners own more than 51% of the computing power in the network,
they can compromise the neutrality of the system.

Centralization Pressure
Corporate interests and governments can pressure network providers to centralize the system,
compromising its neutrality.

Technical Difficulties
Maintaining the protocol's neutrality requires constant attention and technical expertise from
programmers and crypto experts.

10.What is a smart Contract? Discuss how it is used in Blockchain

 A smart contract is a self-executing program that automates the actions required in an

agreement or contract. Once completed, the transactions are trackable and irreversible.
 Smart contracts permit trusted transactions and agreements to be carried out among
disparate, anonymous parties without the need for a central authority, legal system, or
external enforcement mechanism.
 Smart contracts are scripts that automate the actions specific to a contract between two
parties.
 Smart contracts do not contain legal language, terms, or agreements—only code that
executes actions when specified conditions are met.
 Smart contracts work by following simple “if/when…then…” statements that are written
into code on a blockchain.
 A network of computers executes the actions when predetermined conditions have been
met and verified.
  smart contract can be programmed by a developer, although increasingly, organizations
that use blockchain for business provide templates, web interfaces, and other online tools
to simplify structuring smart contracts.

Benefits of smart contracts

Speed, efficiency and accuracy
• Once a condition is met, the contract is executed immediately. Because smart contracts
are digital and automated, there’s no paperwork to process and no time spent
reconciling errors that often result from manually filling in documents.
Trust and transparency
• Because there’s no third party involved, and because encrypted records of transactions
are shared across participants, there’s no need to question whether information has
been altered for personal benefit.
Security
Savings
How smart contract works

Applications of smart contracts

 Safeguarding the efficacy of medications

 Increasing trust in retailer-supplier relationships
 Making international trade faster and more efficient

Some of the downfalls of smart contracts are:

Permanent: They cannot be changed if there are mistakes
Human factor: They rely on the programmer to ensure the code addresses the terms of the
contract.
Loopholes: There may be loopholes in the coding, allowing for contracts to be executed in bad
Faith
11.Discuss the Concept of Extensibility in Blockchain Technology.

The extensibility of a blockchain refers to its ability to accommodate changes and improvements over
time without compromising its core functionalities, security, and consensus mechanisms. Blockchain
extensibility is an important aspect because it allows the technology to evolve and adapt to new
requirements, use cases, and technological advancements.

Here are some ways in which blockchain extensibility can be achieved:

• Protocol Upgrades: Blockchain protocols can be upgraded to introduce new features, enhance
security, improve scalability, or address vulnerabilities. However, these upgrades need to be
carefully planned and executed to ensure network consensus and prevent forks.
• Soft Forks and Hard Forks: Soft forks involve making changes that are backward compatible,
meaning nodes that haven't upgraded can still participate in the network but won't have access to
new features. Hard forks, on the other hand, introduce changes that are not backward compatible
and require all nodes to upgrade to the new protocol. Both approaches offer ways to extend a
blockchain's capabilities.
• Smart Contracts and Decentralized Applications (DApps): Smart contracts are self-executing
programs that run on a blockchain. They enable a wide range of applications beyond simple
transactions, including decentralized finance (DeFi), supply chain management, digital identity,
and more. The extensibility of a blockchain can be greatly enhanced by allowing developers to
create and deploy their own smart contracts and DApps.
• Consensus Mechanism Flexibility: Some blockchains allow for the customization of consensus
mechanisms. For example, Ethereum is transitioning from Proof of Work (PoW) to Proof of
Stake (PoS) to improve scalability and energy efficiency. This kind of transition illustrates how
consensus mechanisms can be adjusted to accommodate changing requirements.
• Interoperability: Blockchain networks can be designed to communicate with each other,
enabling cross-chain interactions. This allows the benefits and capabilities of different
blockchains to be leveraged collectively, creating a more comprehensive ecosystem.
Ultimately, the extensibility of a blockchain depends on its design principles, the community's
willingness to adapt, and the technical capabilities of the underlying technology

12.Discuss about RSA and Elliptic curve cryptography algorithms.

Rivest, Shamir & Adleman who first publicly described it in 1977.
• It is an algorithm for public-key cryptography.
RSA algorithm involves three steps
• Key Generation
• Encryption
• Decryption
Key Generation
1. Select p, q where p & q both prime, p≠q
2. Calculate n = p × q
3. Calculate Ø(n) = (p-1) × (q-1)
 4. Select integer e such that gcd(Ø(n),e)=1; 1<e< Ø(n)
5. Calculate d, d ≡ e-1 (mod Ø(n)) or d.e ≡ 1 (mod Ø(n))
Public Key : PU = { e, n }
Private Key : PR = { d, n }
Encryption
Plaintext : M < n
Ciphertext : C = Me mod n
Decryption
Ciphertext : C
Plaintext : M = Cd mod n
Example
1. Select primes: p=17 & q=11
2. Compute n = p q =17×11=187
3. Compute ø(n)=(p–1)(q-1)=16×10=1604. Select e : gcd(e,160)=1; (e,160)=1; choose e=7
5. Determine d: de=1 mod 160 and d < 160 Value is d=23 since 23×7=161= 10×160+1
6. Publish public key PU={7,187}
7. Keep secret private key PR={23,187}
Encryption/Decryption
Message M = 88 (88<187)
Encryption: C = 887 mod 187 = 11
Decryption: M = 1123 mod 187 = 88

Elliptic Curve Cryptography (ECC)

Elliptic Curve Cryptography (ECC) is a key-based technique for encrypting data. ECC focuses
on pairs of public and private keys for decryption and encryption of web traffic.
ECC, an alternative technique to RSA, is a powerful cryptography approach. It generates
security between key pairs for public key encryption by using the mathematics of elliptic curves.
ECC has popularity due to its smaller key size and ability to maintain security.
ECC bases its approach to public key cryptographic systems on how elliptic curves are
structured algebraically over finite fields. Therefore, ECC creates keys that are more difficult,
mathematically, to crack.
An elliptic curve for current ECC purposes is a plane curve over a finite field which is made up
of the points satisfying the equation:
y²=x³ + ax + b.
 In this elliptic curve cryptography example, any point on the curve can be mirrored over the x-
axis and the curve will stay the same. Any non-vertical line will intersect the curve in three
places or fewer.
Procedure of ECC
a) The first task in this system is to encode the plaintext message m to be sent as an x-y point Pm.
b) It is the point Pm that will be encrypted as a ciphertext and subsequently decrypted.
c) We can’t simply encode the message as the x or y co-ordinate of a point, because not all such
coordinates are in Eq (a , b).
d) As with the key exchange system, an encryption / decryption system requires a point G and an
elliptic group Eq (a , b) as parameters. Each user A selects a private key nA and generates a
public key PA=nA×G.
e) To encrypt and send a message Pm to B, A chooses a random positive integer k and produces
tnhe ciphertext Cm consisting of the pair of points:
Cm=kG,Pm+kPB
f) Note that A has used B’s public key PB. To decrypt the ciphertext, B multiplies the first point in
the pair by B’s secret key and subtracts the result from the second point :
Pm+kPBnB(kG)=Pm+k(nBG)nB(kG)=Pm
g) A has masked the message Pm by adding kPB to it. Nobody but A knows the value of k, so
even though PB is a public key, nobody can remove the mask kPB. However , A also includes a
“clue”, which is enough to remove the mask if one knows the private key nB. For an attacker to
recover the message, the attacker would have to compute k given G and kG, which is assumed
hard.
Security of Elliptic Curve Cryptography :
The security of ECC depends on how difficult is to determine k given kP and P. This is referred
to as the elliptic curve logarithm problem.
The fastest known technique for taking the elliptic curve logarithm is known as the Pollard rho
method.