Securing Central Bank Foreign Exchange Reserves with Blockchain: A PoA-SBFT Approach

Central bank foreign exchange reserves face signifi-cant threats from hacking, cyber attacks, and money laundering, necessitating advanced security solutions. Blockchain technology, with its decentralized and immutable nature, offers a strong platform for securing these reserves. Our research introduces a novel blockchain-based approach using Proof of Authority with Sharding and Byzantine Fault Tolerance (PoA-SBFT) consensus for efficient transaction validation and Fully Homomorphic Encryption (FHE) for enhanced data confidentiality. Smart contracts automate transaction management and compliance checks, while comprehensive risk assessment and mitigation strategies ensure system resilience. This integrated solution aims to provide a secure, scalable, and transparent system for managing central bank foreign exchange reserves, thereby enhancing national financial stability.