Cloud Cost Optimization Using Smart Contracts and Unsupervised Machine Learning

Abstract

Cloud computing underpins modern IT infrastructure by delivering scalable, on-demand resource provisioning, yet controlling cloud expenditure remains a pressing challenge. Dynamic pricing structures, unpredictable workloads, and billing pipelines that lack real-time visibility create conditions in which unauthorized consumption and anomalous usage spikes routinely escape timely detection. This paper presents CloudPay, a blockchain-integrated cloud storage billing system that unifies unsupervised machine learning with smart contract execution to deliver verifiable, fine-grained, and fraud-resistant cost governance. The system converts user storage activity into time-series representations and applies the Isolation Forest algorithm to detect abnormal consumption spikes without any labelled training data. Flagged events are routed through an owner confirmation protocol that validates suspicious uploads before billing proceeds, preventing unauthorized charges from entering the settlement pipeline. Smart contracts autonomously compute GB-time-based charges, execute tokenized payments, and anchor every transaction to an immutable SHA-256 blockchain ledger. Experimental results confirm that the system achieves 94.4% anomaly detection accuracy, 99.7% billing precision, and an 18.4% reduction in overall cloud expenditure relative to static allocation baselines. These results demonstrate that integrating unsupervised anomaly detection with cryptographically enforced billing logic is a viable path toward tamper-evident, real-time cost governance in multi-tenant cloud environments.