Design of an Intelligent Cross-Layer Risk-Adaptive Zero-Knowledge Permissioned Blockchain Framework for Secure Intelligent Financial Transaction Processing

Abstract

Secure financial transactions require more than just an immutable record — they also demand privacy-preserving identity assurance (which enables secure, trusted and transparent communication), adaptive fraud intelligence (to detect fraudulent transactions), policy-aware execution (so organizations can set their own rules for data use), resilient consensus (enables multiple parties to agree on data use), and auditable records within a single low-latency pipeline. Current permissioned-blockchain solutions often have independent optimizations for authentication, access control, fraud detection, consensus and auditing; as such, these separate areas lead to fragmented security decision making, unnecessary disclosure, static endorsement policies and throughput–latency tradeoffs. The research presented here describes FinTrust-X, a cross-layer risk-adaptive permissioned blockchain architecture where the security state created by each layer is used to create the next. A Zero-Knowledge Context Adaptive Role and Trust Authentication System (ZK-CARTA) provides zero knowledge context adaptive role and trust authentication to enable verifiable credentials to be selectively disclosed based on user device/session context and dynamically authorize users to minimize identity exposure and privilege abuse. Users are provided authenticated evidence to feed a Temporal Graph Transformer (TRiG-FraudFormer) that models joint transactional, account, device, merchant, beneficiary and trust relationships to produce a calibrated fraud-risk assessment along with counter-factual explanations. Risk is converted into adaptive smart contract paths, confidence levels and endorsement requirements to minimize unnecessary verification overheads. Safety constrained reinforcement learning is applied in RA-BFTune to adaptively optimize batching, ordering and Byzantine fault tolerant consensus based on transaction risk and network-states. Continuous cryptographic audit evidence is produced in PQ-AuditTwin utilizing immutable provenance, Merkle verification and ML-DSA-based post-quantum signature generations. Feedback regarding changes/drift in previous layer inputs is returned to those layers. Targeted validation results show ROC-AUC values of .96-.98 and F1 values of .92-.95 were achieved in addition to achieving authentication times less than 30ms., 1500-2000 TPS, P95 response time < 700ms, and greater than a 90% reduction in unnecessary disclosure of sensitive data from users indicating significant improvements in confidentiality, fraud-resilience, authorization-efficiency, scalability and auditability when compared against multi-organization Fabric workloads that included injected fraud and Byzantine faults.