Blockchain-enabled fraud detection technique for secure transactions

Abstract

As financial transactions increasingly migrate to digital platforms, fraud detection has become a critical area of concern for governments, businesses, and consumers. Traditional fraud detection systems, while effective to some degree, are often limited by their centralized architecture, vulnerability to tampering, and delayed response capabilities. This paper proposes a blockchain-based fraud detection framework that integrates smart contracts, immutable ledger design, and external data sources via oracles to improve real-time detection and prevention of fraudulent transactions. The system leverages blockchain’s transparency and automation to enhance the integrity of transaction processing while reducing reliance on centralized oversight. This work is intended as a conceptual and architectural contribution, offering a detailed model and identifying key challenges and directions for future research.