SCHOOL OF TECHNOLOGY
JORAM SIREE
2107233
21/07233@students.kcau.ac.ke
Question 5
a) Double Spending Problem (4 marks)
The double spending problem refers to the risk of a digital currency being spent more than once. This
occurs when the same digital token or crypto currency unit is used in multiple transactions. For example,
if Imani has 1 Bitcoin, she could potentially send a copy of that same Bitcoin to both Bob and Charlie
simultaneously, essentially spending the same money twice.
b) Blockchain and Its Applications (5 marks)
Blockchain is a distributed, immutable ledger technology that records transactions across a network of
computers. Key application areas include:
- Cryptocurrency and financial services
- Supply chain management
- Healthcare records
- Digital identity verification
- Smart contracts
- Voting systems
c) Smart Contracts (5 marks)
Smart contracts are self-executing contracts with terms directly written into code. They automatically
enforce and execute agreement terms when predetermined conditions are met. In blockchain, they:
- Automate transactions
- Reduce intermediaries
- Ensure transparency
- Provide immutable record-keeping
d) Blockchain Properties (2 marks)
1. Decentralization
2. Immutability
3. Transparency
4. Consensus-driven
e) Blockchain Conflicts (4 marks)
Transparency vs. Privacy:
- While blockchain provides transparent transaction records, this conflicts with the need for privacy
- Challenge of balancing public verifiability with confidential information
Security vs. Speed:
- Higher security often requires more complex validation processes
- More validation nodes increase security but decrease transaction speed
Question 6
a) Ethereum DAO (2 marks)
An Ethereum DAO (Decentralized Autonomous Organization) is a blockchain-based organization
governed by smart contracts and operated by community members through voting mechanisms,
without traditional hierarchical management.
b) DAO Functioning (4 marks)
DAOs function through:
- Smart contracts that define rules and operations
- Token-based membership system
- Transparent decision-making processes
- Automated execution of approved proposals
- Community-driven governance
c) DAO Voting (4 marks)
Voting in Ethereum DAOs works through:
- Token-weighted voting rights
- On-chain proposal submission
- Transparent voting period
- Automatic execution of passed proposals
- Verifiable voting records
d) DAO Fund Management (5 marks)
DAOs handle funds through:
- Multi-signature wallets
- Smart contract-controlled treasury
- Community-approved spending
- Transparent transaction records
- Automated disbursement based on voting
e) Consensus Mechanisms in DAOs (5 marks)
Consensus mechanisms in Ethereum DAOs:
- Proof of Stake: Validators stake ETH to secure network
- Economic incentives for honest behavior
- Slashing conditions for malicious actions
- Network security through distributed validation
- Energy-efficient consensus compared to PoW
Question 7
a) Proof of Ownership and Transfer (3 marks)
Ledger properties for ownership:
- Immutable record of all transactions
- Cryptographic proof of ownership
- Transparent transfer history
b) Generic-use Patterns (5 marks)
I. Proof of existence: Verifies document/asset exists at specific time
II. Proof of nonexistence: Confirms absence of conflicting records
III. Proof of time: Timestamps for chronological verification
IV. Proof of order: Establishes sequence of events/transactions
V. Proof of identity: Validates entity authenticity
c) Access Restriction Impact (3 marks)
Impacts on:
- P2P Architecture: Affects node participation
- Distributed Nature: Limits decentralization
- Purpose: Compromises transparency goals
d) Implementation Challenges (4 marks)
1. Scalability limitations
2. Energy consumption
3. Regulatory compliance
4. Integration with legacy systems
Question 8
a) Integrity Threats in P2P Systems (5 marks)
Examples:
- Sybil attacks: Multiple fake identities
- 51% attacks: Majority control threat
- Double-spending attempts
- Eclipse attacks: Node isolation
- Byzantine behavior: Malicious nodes
b) Network Handshake Process (5 marks)
c) Access Restriction Impacts (5 marks)
Effects on:
- P2P Architecture: Network participation
- Distributed Nature: Decentralization level
- Purpose: Transparency and trust
Question 9
a) Consensus Models (6 marks)
i) Proof of Work: Computational puzzle-solving for validation
ii) Proof of Stake: Token-based validation rights
iii) Round Robin: Sequential block creation by validators
b) Security Contributions (4 marks)
- Decentralization: Distributed control
- Cryptographic Hashing: Data integrity protection
c) Blockchain Types (4 marks)
Public vs Private:
- Public: Open participation
- Private: Restricted access
Permissioned vs Permissionless:
- Permissioned: Authorized participants
- Permissionless: Open participation
d) Smart Contracts (3 marks)
Self-executing programs that:
- Automate agreements
- Reduce intermediaries
- Ensure transparency
e) Blockchain Applications (3 marks)
Key areas:
- Financial services
- Supply chain
- Healthcare
Question 10
a) DeFi Role (5 marks)
Blockchain enables:
- Decentralized lending
- Automated market making
- Peer-to-peer transactions
- Smart contract-based services
- Transparent financial operations
b) DeFi Benefits and Risks (4 marks)
Benefits:
- Financial inclusion
- Reduced intermediaries
Risks:
- Smart contract vulnerabilities
- Market volatility
c) Adoption Challenges (6 marks)
Major challenges:
- Scalability issues
- Regulatory uncertainty
- Technical complexity
- Energy consumption
- Integration difficulties
- User adoption barriers
Question 11
a) Blockchain Voting Architecture (5 marks)
Components:
- Voter authentication system
- Encrypted ballot storage
- Consensus mechanism
- Vote verification system
- Result tabulation
b) Privacy and Integrity (5 marks)
Measures:
- Zero-knowledge proofs
- Homomorphic encryption
- Ring signatures
- Voter anonymity
- Immutable records
c) Accessibility Enhancement (5 marks)
Features:
- Mobile voting options
- Multi-language support
- Assisted voting interfaces
- Remote participation
- Verification tools
Question 12
a) Governance Models (4 marks)
On-chain:
- Smart contract-based voting
- Automated execution
Off-chain:
- Community discussions
- Proposal development
b) Smart Contract Development (6 marks)
Process:
1. Requirements analysis
2. Contract coding
3. Testing and auditing
4. Deployment preparation
5. Network deployment
6. Monitoring and maintenance
c) Emerging Trends (5 marks)
Current trends:
- Layer 2 scaling solutions
- Cross-chain interoperability
- DeFi innovations
- NFT applications
- Sustainable consensus mechanisms