Eccouncil 312-82 EC-Council Blockchain Fintech Certification (BFC) Exam Practice Test

Answer : D

Ethereum currently supports a transaction throughput of approximately 10-14 transactions per second (TPS). This transaction speed is a result of Ethereum's design, which balances decentralization and security, albeit at the cost of scalability. This TPS rate is consistent across the Ethereum network prior to its upgrade to Ethereum 2.0, which aims to increase scalability through sharding and Proof of Stake.

Key Details:

Limitations of Current Throughput: Ethereum's TPS rate is due to limitations in its consensus mechanism (formerly Proof of Work, now Proof of Stake) and block size, which prioritize security over transaction speed.

Comparison with Other Networks: Bitcoin, for example, supports around 3-7 TPS, while other networks like Solana or Binance Smart Chain support significantly higher TPS. Ethereum's TPS may increase as Ethereum 2.0 is fully implemented, which aims to improve its scalability.

Impact on Decentralized Applications (DApps): Ethereum's transaction capacity impacts DApps running on the network, as higher usage can lead to congestion and increased transaction fees (gas fees). The upcoming upgrades are intended to alleviate these issues and enhance performance.

Therefore, D. Ethereum is the correct answer, as it supports approximately 10-14 TPS in its current form.

Answer : C

The answer is (C) Quilt.

Hyperledger Quilt is a Java implementation of the Interledger Protocol (ILP). ILP is designed to transfer value across different ledgers, whether they are distributed ledgers (like blockchains) or traditional non-distributed ledgers.

Here's why the other options aren't the best fit:

Composer: Hyperledger Composer was a tool for building blockchain applications, but it has been deprecated.

Cello: Hyperledger Cello aims to provide a modular blockchain platform, making it easier to deploy and manage blockchain networks.

Caliper: Hyperledger Caliper is a benchmarking tool used to measure the performance of different blockchain implementations.

Quilt's primary function is to enable interoperability between different ledger systems, which is crucial for the broader adoption and integration of blockchain technology.

Answer : B

The primary benefit of blockchain in the healthcare industry for patients is total control over personal health records. Blockchain enables secure, decentralized storage of health data, allowing patients to control access to their information and share it with healthcare providers as needed.

Key Details:

Data Ownership and Privacy: Blockchain gives patients the ability to own and manage their health records. They can grant or revoke access to different healthcare providers, ensuring that only authorized personnel have access to their data.

Improved Security: Health records stored on a blockchain are encrypted and decentralized, making them resistant to tampering and unauthorized access. This enhances patient privacy and reduces the risk of data breaches.

Interoperability and Accessibility: Blockchain facilitates seamless sharing of health records across different healthcare providers and systems, improving coordination and care continuity without compromising data integrity.

Therefore, B. Total control over personal health records is the correct answer, as it represents a significant advantage for patients in managing their healthcare information securely.

Answer : D

In blockchain terminology, a transaction represents the transfer of value from one address to another. Each transaction is recorded on the blockchain as an immutable entry, often representing a movement of digital assets or a record of an event.

Key Details:

Nature of Transactions: A blockchain transaction involves a digital asset or token being sent from one blockchain address (wallet) to another. The transaction is broadcast to the network, validated by nodes, and then recorded on the blockchain ledger.

Transfer of Value: Blockchain transactions serve as proof of the transfer of value, which could represent cryptocurrency movement, digital asset exchange, or a specific record of an event, depending on the blockchain's purpose.

Inclusion in Blocks: Each transaction is grouped into blocks, which are then cryptographically linked together, forming the blockchain. This ensures all transactions are secure, traceable, and verifiable.

Thus, D. Transaction is the correct answer, as it describes the fundamental concept of transferring value on a blockchain.

Answer : A

FinCEN requires money transmitters and companies involved in virtual currency (CVC) transmission to report suspicious transactions as part of their anti-money laundering (AML) responsibilities. This is in addition to maintaining an effective AML program and registering as a money service business (MSB).

Key Details:

AML Program: The program must be reasonably designed to detect and prevent the use of financial services for money laundering or terrorist financing.

Reporting Suspicious Activity: FinCEN mandates that companies must file Suspicious Activity Reports (SARs) for any transactions that appear to be potentially suspicious or indicative of illegal activities.

Regulatory Compliance: This requirement ensures that businesses adhere to federal regulations, contributing to a secure financial system by monitoring and reporting illicit activity.

Therefore, A. Report suspicious transactions is the correct answer, as this is a key requirement for companies under FinCEN's regulations regarding money transmission and virtual currencies.

Answer : A

A Permissioned ledger is a blockchain where participants are known and trusted, and access to the network is restricted to authorized entities. Permissioned ledgers are commonly used in enterprise and consortium settings where privacy, compliance, and control over data are essential.

Key Details:

Controlled Access: In a permissioned ledger, only pre-approved participants can validate transactions and participate in the consensus process. This model ensures that all network members are identified and trusted, which is ideal for environments requiring a higher level of control and privacy.

Use Cases: Permissioned ledgers are widely used in industries such as finance, healthcare, and supply chain, where it's important to know and trust participants due to regulatory or operational needs.

Contrast with Permissionless Ledgers: Unlike permissionless ledgers (such as Bitcoin), which allow anyone to join and participate in the network, permissioned ledgers restrict participation to entities that meet specific criteria.

Thus, A. Permissioned ledger is the correct answer, as it describes a blockchain network where participants are known and trusted.

Answer : A, D

According to studies conducted by Deloitte and other industry research, blockchain offers several benefits for the insurance industry, particularly in more efficient claims processing and lower costs. Blockchain's capabilities in data immutability, transparency, and automation play key roles in streamlining insurance processes and reducing operational expenses.

Key Details:

Efficient Claims Processing: Blockchain enables quicker verification and processing of claims by automating workflows through smart contracts. This reduces paperwork, minimizes errors, and speeds up the claims process, improving customer satisfaction.

Lower Costs: By reducing intermediaries and leveraging automation, blockchain lowers administrative costs. It minimizes the need for manual verification and fraud detection, which traditionally consume significant resources in the insurance industry.

Transparency and Fraud Reduction: Blockchain provides an immutable and transparent record of all transactions. This helps prevent fraud, as all stakeholders have access to the same data, reducing discrepancies and the need for extensive audits.

In conclusion, A. More efficient claims processing and D. Lower costs are the correct answers, as these are key benefits of blockchain for the insurance industry identified in Deloitte's research.