Relaxed Sender Anonymity for CBDC Interbank Settlement: A Zero-Knowledge Approach on Permissioned EVM

• URL: http://arxiv.org/abs/2608.28529v2
• Date: Fri, 04 Sep 2026 15:18:17 GMT
• Title: Relaxed Sender Anonymity for CBDC Interbank Settlement: A Zero-Knowledge Approach on Permissioned EVM
• Abstract summary: We propose a confidential interbank settlement protocol for permissioned-compatible networks.<n>In this model, the initiating institution remains publicly identifiable on-chain for accountability and compliance.<n>The protocol supports shield, confidential transfer, and unshield state transitions.
• Score: 0.0
• License: http://creativecommons.org/licenses/by-nc-nd/4.0/
• Abstract: Central Bank Digital Currency (CBDC) interbank settlement systems operating on Distributed Ledger Technology (DLT) face a fundamental trade-off: blockchain transparency enables trustless verification but exposes commercially sensitive bilateral transaction flows to all network participants. We propose a confidential interbank settlement protocol for permissioned Ethereum-compatible networks that resolves this tension through a relaxed sender anonymity model tailored to regulatory AML/CFT requirements. In this model, the initiating institution remains publicly identifiable on-chain for accountability and compliance, while the receiving institution, transfer amount, and business payload are cryptographically obfuscated. We realize the protocol on Hyperledger Besu using QBFT consensus, combining Groth16 zero-knowledge proofs over BN254, Poseidon hash commitments in an incremental Merkle tree, multi-recipient ECIES payload encryption, and an on-chain NoteRegistry contract that stores encrypted notes as an append-only ledger log, eliminating trusted off-chain custody servers. The protocol supports shield, confidential transfer, and unshield state transitions. Experimental evaluation across a five-node network (three commercial banks, a central bank operator, and a securities depository) demonstrates end-to-end settlement in 8-16 s, proof verification overhead of about 1 ms (around 220k gas) via EVM precompiles, and client proof generation in 4-12 s on commodity ARM hardware. While receiver confidentiality is established at the protocol level, the current proof-of-concept NoteRegistry uses owner-indexed events, a trade-off addressable in production via uniform event broadcasting.

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