Block 1 → Block 2 → Block 3 → Block 4
(previous hash) (previous hash)

🟦 Chapter 1: Basics & Core Concepts (Q1–Q12)

Q1. Blockchain in banking is mainly used for which of the following?
a) Printing currency notes
b) Decentralized and tamper-proof transaction records
c) Increasing physical branch networks
d) Manual ledger reconciliation
Answer: b) Decentralized and tamper-proof transaction records
Explanation: Blockchain provides a distributed ledger where data is shared, verified, and cannot be easily altered. 👉 (HIGHLY IMPORTANT)

Q2. Blockchain is best described as a:
a) Centralized database
b) Distributed and shared digital ledger
c) Type of operating system
d) Physical ledger used by RBI
Answer: b) Distributed and shared digital ledger
Explanation: Blockchain keeps identical copies of records at many nodes, forming a shared ledger.

Q3. In blockchain, data is stored in units called:
a) Packets
b) Frames
c) Blocks
d) Pages
Answer: c) Blocks
Explanation: Each block contains transactions and is linked to previous blocks, forming a chain.

Q4. Which of the following is a key property of blockchain ledgers?
a) Easily editable by admin
b) Immutable once data is confirmed
c) Only stored at central bank server
d) Accessible without any network
Answer: b) Immutable once data is confirmed
Explanation: After a block is validated and added, its data cannot be changed without altering all later blocks. 👉 (HIGHLY IMPORTANT)

Q5. The first block of any blockchain is called:
a) Origin block
b) Parent block
c) Genesis block
d) Root block
Answer: c) Genesis block
Explanation: Genesis block is the very first block from which the blockchain starts.

Q6. Which technology is most closely associated with blockchain?
a) Optical fibers
b) Cryptography
c) Barcoding
d) Bluetooth
Answer: b) Cryptography
Explanation: Blockchain uses cryptographic hashes and keys to secure and link data.

Q7. “Decentralization” in blockchain means:
a) Only RBI can maintain the ledger
b) Data is stored and controlled by many nodes, not a single central authority
c) All data is stored offline
d) Only one copy of data exists
Answer: b) Data is stored and controlled by many nodes, not a single central authority
Explanation: No single node controls everything; many participants maintain the ledger.

Q8. Bitcoin uses blockchain mainly to:
a) Manage email
b) Track and verify cryptocurrency transactions
c) Print invoices
d) Encrypt images only
Answer: b) Track and verify cryptocurrency transactions
Explanation: Bitcoin is the earliest popular use-case of blockchain for digital currency.

Q9. The biggest innovation of blockchain in digital money is solving the:
a) Power shortage problem
b) Double-spending problem
c) ATM theft problem
d) SMS failure problem
Answer: b) Double-spending problem
Explanation: Blockchain avoids the same digital coin being used twice.

Q10. Which one is NOT a core feature of blockchain?
a) Immutability
b) Transparency
c) Single-central control
d) Distributed ledger
Answer: c) Single-central control
Explanation: Blockchain is inherently decentralized, not controlled by a single center.

Q11. In blockchain, a “node” is:
a) Only the RBI office
b) Any computer/device participating in the network and storing the ledger
c) Only customer’s mobile phone
d) Only ATM machine
Answer: b) Any computer/device participating in the network and storing the ledger
Explanation: Nodes maintain copies of the ledger and verify transactions.

Q12. The main reason blockchain is called “tamper-evident” is:
a) Blocks are stored in paper form
b) Changing old data breaks hash links and becomes detectable
c) RBI watches every transaction manually
d) Transactions expire after one day
Answer: b) Changing old data breaks hash links and becomes detectable
Explanation: Because hashes of previous blocks are stored in each new block, tampering becomes obvious. 👉 (HIGHLY IMPORTANT)

🟦 Chapter 2: Structure, Types & Consensus (Q13–Q26)

Q13. Which of the following is typically present in each block?
a) Previous block hash
b) Random newspaper article
c) ATM camera image
d) Account passwords in plain text
Answer: a) Previous block hash
Explanation: Each block stores the hash of the previous block, linking the chain.

Q14. A cryptographic hash function in blockchain should be:
a) One-way and collision-resistant
b) Easily reversible
c) Only for image files
d) Used only by admin
Answer: a) One-way and collision-resistant
Explanation: Hashes should not be reversible and should uniquely represent input data.

Q15. A public blockchain is best defined as a network where:
a) Only one bank is allowed to participate
b) Anyone can read and participate in validation, subject to protocol rules
c) Only RBI can access data
d) No one knows the rules
Answer: b) Anyone can read and participate in validation, subject to protocol rules
Explanation: Public blockchains are open networks like Bitcoin, Ethereum.

Q16. A private blockchain is more suitable when:
a) No control is needed on participants
b) Sensitive enterprise data must be shared only with approved entities
c) Transactions must be fully anonymous to public
d) It is used as cryptocurrency only
Answer: b) Sensitive enterprise data must be shared only with approved entities
Explanation: Private chains are permissioned and controlled.

Q17. A consortium blockchain is:
a) Owned by a single user
b) Managed by a group of organizations together
c) Only for government
d) Used only for gaming
Answer: b) Managed by a group of organizations together
Explanation: In consortium chains, multiple institutions jointly control the network. 👉 (HIGHLY IMPORTANT)

Q18. Which of the following pairs is correct?
a) Public blockchain – fully permissioned, closed
b) Private blockchain – permissioned and controlled
c) Consortium blockchain – no control
d) Hybrid blockchain – only for crypto mining
Answer: b) Private blockchain – permissioned and controlled
Explanation: Private blockchains restrict access to selected participants.

Q19. The main function of a “consensus mechanism” in blockchain is to:
a) Decide interest rates
b) Agree on the valid state of the ledger across nodes
c) Approve bank branch openings
d) Generate customer passwords
Answer: b) Agree on the valid state of the ledger across nodes
Explanation: Consensus ensures all nodes accept the same set of valid transactions. 👉 (HIGHLY IMPORTANT)

Q20. Proof of Work (PoW) involves:
a) Voting by all banks physically
b) Solving complex mathematical puzzles requiring computation
c) Only storing documents on cloud
d) Manual verification of signatures
Answer: b) Solving complex mathematical puzzles requiring computation
Explanation: In PoW, miners compete to solve puzzles to add new blocks.

Q21. A major disadvantage of Proof of Work (PoW) is:
a) Very low security
b) High energy and computational cost
c) No decentralization
d) No cryptography used
Answer: b) High energy and computational cost
Explanation: PoW is secure but energy intensive and slower.

Q22. Proof of Stake (PoS) primarily selects validators based on:
a) Distance from data center
b) Number/value of coins staked
c) Age of the user
d) Size of password
Answer: b) Number/value of coins staked
Explanation: In PoS, validators lock coins as stake to propose/validate blocks.

Q23. When banks create a permissioned blockchain network among themselves, which consensus is most likely?
a) Proof of Authority / Practical BFT variants
b) Proof of Work on public internet
c) Tossing a coin
d) Voting via emails
Answer: a) Proof of Authority / Practical BFT variants
Explanation: In permissioned networks, known validators use authority-based or BFT-style consensus.

Q24. Which statement about block size is TRUE?
a) It is always infinite
b) It limits how many transactions can fit in one block
c) It has no impact on transaction throughput
d) It is the same in all blockchain platforms
Answer: b) It limits how many transactions can fit in one block
Explanation: Larger blocks can hold more transactions but may affect performance.

Q25. Merkle trees are used in blockchain mainly to:
a) Compress audio
b) Efficiently summarize and verify large sets of transactions
c) Encrypt user PINs
d) Store interest rates
Answer: b) Efficiently summarize and verify large sets of transactions
Explanation: Merkle root in block header represents all transactions in a block.

Q26. 51% attack on a public blockchain refers to:
a) More than half of blocks are empty
b) More than 51% of nodes go offline
c) A single entity controls majority of hashing power and can manipulate chain
d) More than 51% of customers use the network
Answer: c) A single entity controls majority of hashing power and can manipulate chain
Explanation: With >50% power, an attacker could double-spend or censor transactions. 👉 (HIGHLY IMPORTANT)

🟦 Chapter 3: Applications in Banking & Finance (Q27–Q40)

Q27. A key benefit of blockchain for cross-border payments is:
a) Slower settlement
b) Reduced need for intermediaries and faster settlement
c) More manual reconciliation
d) Lack of transparency
Answer: b) Reduced need for intermediaries and faster settlement
Explanation: Blockchain allows direct transfer and faster finality for international payments. 👉 (HIGHLY IMPORTANT)

Q28. In KYC using blockchain, the main advantage is:
a) KYC is no longer required
b) Verified customer identity can be securely shared across institutions
c) Customers can fake identity easily
d) Data must be re-entered every time
Answer: b) Verified customer identity can be securely shared across institutions
Explanation: A shared ledger avoids repeated KYC, with customer consent.

Q29. Which is NOT a typical blockchain use-case in banking?
a) Trade finance and supply chain
b) Shared KYC utility
c) ATM air conditioning control
d) Cross-border remittances
Answer: c) ATM air conditioning control
Explanation: Blockchain is used for financial and data flows, not device cooling.

Q30. Smart contracts in blockchain are:
a) Written legal agreements signed manually
b) Self-executing code with rules that trigger automatically
c) Only SMS-based contracts
d) RBI circulars on paper
Answer: b) Self-executing code with rules that trigger automatically
Explanation: Smart contracts execute actions when pre-defined conditions are met. 👉 (HIGHLY IMPORTANT)

Q31. In trade finance, blockchain can help in:
a) Increasing manual paperwork
b) Automating letter of credit workflows and reducing fraud
c) Hiding shipment status
d) Removing all documentation
Answer: b) Automating letter of credit workflows and reducing fraud
Explanation: Blockchain-based platforms can track documents and events across parties.

Q32. One of the biggest operational benefits of blockchain for banks is reduction in:
a) Number of branches
b) Reconciliation between different ledgers of multiple parties
c) Need for customer service
d) Regulatory reporting
Answer: b) Reconciliation between different ledgers of multiple parties
Explanation: Shared ledger gives a single source of truth across institutions.

Q33. In fraud detection, blockchain helps mainly because:
a) Records can be deleted anytime
b) Transactions are immutable and auditable
c) No records are kept
d) All data is private and invisible
Answer: b) Transactions are immutable and auditable
Explanation: Once recorded, transactions provide a strong audit trail.

Q34. Tokenization of assets on blockchain allows:
a) Only printing asset details
b) Real-world assets to be represented as digital tokens that can be traded
c) Hiding all ownership information
d) Destroying asset records
Answer: b) Real-world assets to be represented as digital tokens that can be traded
Explanation: Property, bonds, etc., can be split into digital tokens for easier transfer.

Q35. For retail customers, a blockchain-based remittance app can:
a) Only be used offline
b) Enable near real-time, low-cost cross-border transfers
c) Replace all bank branches overnight
d) Work without any regulation
Answer: b) Enable near real-time, low-cost cross-border transfers
Explanation: Less dependence on intermediary banks shortens settlement time.

Q36. In supply-chain finance, blockchain can:
a) Hide supplier invoices
b) Provide end-to-end visibility of invoices and payments
c) Remove all records of movement
d) Only track cash deposits
Answer: b) Provide end-to-end visibility of invoices and payments
Explanation: All stakeholders can see the same trusted record of events.

Q37. Which of the following is a realistic benefit of blockchain for regulators and auditors?
a) No records to inspect
b) Real-time access to consistent transaction data
c) More manual data entry needed
d) Records are always secret
Answer: b) Real-time access to consistent transaction data
Explanation: Regulators can get near real-time data from a shared ledger.

Q38. For banks, using a shared blockchain network with other banks can primarily help in:
a) Competing on branch locations
b) Having a common, verified record of inter-bank transactions
c) Increasing cheque bounce cases
d) Removing need for any IT systems
Answer: b) Having a common, verified record of inter-bank transactions
Explanation: Shared ledger removes duplication and mismatches.

Q39. Blockchain-based trade documents (like e-BL – electronic Bill of Lading) mainly reduce:
a) Import duty
b) Risk of forgery and delays due to physical document movement
c) GST
d) Export volume
Answer: b) Risk of forgery and delays due to physical document movement
Explanation: Digitally signed, immutable docs speed up trade.

Q40. For customers, a major advantage of blockchain-based loan processing could be:
a) Longer approval times
b) Transparent tracking of application status across participants
c) No verification needed
d) No need to repay
Answer: b) Transparent tracking of application status across participants
Explanation: Data shared securely among lender, verifier, and other parties reduces delays and confusion.

🟦 Chapter 4: CBDC, Digital Rupee & Recent Developments (Q41–Q50)

Q41. CBDC stands for:
a) Central Bank Digital Currency
b) Credit Bank Digital Card
c) Crypto-Based Deposits & Cash
d) Central Borrower Digital Credit
Answer: a) Central Bank Digital Currency
Explanation: CBDC is a digital form of a country’s sovereign currency issued by its central bank. 👉 (HIGHLY IMPORTANT)

Q42. In India, the Digital Rupee (e₹) is:
a) A private cryptocurrency
b) A central bank digital currency issued by RBI
c) A type of mutual fund
d) A prepaid gift card
Answer: b) A central bank digital currency issued by RBI
Explanation: e₹ is legal tender in digital form, issued by RBI.

Q43. Compared to private cryptocurrencies, CBDC like e₹ is:
a) Not backed by any authority
b) Backed by central bank and has legal tender status
c) Only for anonymous transactions
d) Always unregulated
Answer: b) Backed by central bank and has legal tender status
Explanation: CBDC carries the same sovereign guarantee as physical currency.

Q44. e₹-W (Wholesale CBDC) is primarily intended for:
a) Common retail customers
b) Inter-bank and large-value transactions
c) Farmers only
d) Students only
Answer: b) Inter-bank and large-value transactions
Explanation: e₹-W is mainly for wholesale segment like inter-bank settlement.

Q45. e₹-R (Retail CBDC) can be used for:
a) Only foreign trade
b) Person-to-person (P2P) and person-to-merchant (P2M) payments
c) Only ATM refilling
d) Only government bonds trading
Answer: b) Person-to-person (P2P) and person-to-merchant (P2M) payments
Explanation: e₹-R is designed for everyday retail payments. 👉 (HIGHLY IMPORTANT)

Q46. As per RBI design, e₹ is intended to mimic which characteristics of cash?
a) Earning high interest
b) Finality of settlement and legal tender status
c) Being fully traceable in public
d) Physical form only
Answer: b) Finality of settlement and legal tender status
Explanation: Like cash, CBDC aims for instant final settlement.

Q47. A major policy advantage of CBDC for central banks is:
a) Loss of control over money
b) Better control and visibility on money flows and monetary policy transmission
c) Complete anonymity like cash with zero trace
d) Removal of KYC norms
Answer: b) Better control and visibility on money flows and monetary policy transmission
Explanation: CBDC can give central banks more granular data and control.

Q48. For commercial banks, one potential RISK of large-scale CBDC adoption is:
a) Increase in deposits
b) Disintermediation if customers shift large deposits from banks to CBDC wallets
c) Reduction of digital payments
d) Loss of all branches overnight
Answer: b) Disintermediation if customers shift large deposits from banks to CBDC wallets
Explanation: If people hold CBDC instead of bank deposits, it may impact banks’ funding.

Q49. Which statement about blockchain adoption challenges in banking is MOST accurate?
a) Technology is fully mature and easy to implement
b) Regulatory clarity, interoperability, and scalability are key challenges
c) There are no security issues
d) It eliminates all compliance requirements
Answer: b) Regulatory clarity, interoperability, and scalability are key challenges
Explanation: These factors slow down wide-scale production use.

Q50. From exam perspective, the BEST way to remember blockchain in banking is that it provides:
a) Extra interest to customers
b) Shared, secure, tamper-proof record-keeping for payments, KYC, trade, and CBDC
c) Only ATM monitoring
d) Only card printing facility
Answer: b) Shared, secure, tamper-proof record-keeping for payments, KYC, trade, and CBDC
Explanation: Almost all exam questions revolve around these core ideas. 👉 (HIGHLY IMPORTANT)