How can I display an attribute from each post inside foreach($latest_posts1 as $post )

It is the post’s content which has blocks, and these blocks have attributes. Internally, these are stored as some fancy HTML comments. To get the rendered HTML, you can use the function get_the_content() and pass it through the filter the_content. I.e., replace

function render_latest_post( $attributes ) { //not sure how to use this function
    $para = $attributes['paragraph']; // I need to display this attribute from the block Thats added in the post
    }

with

$content = apply_filters('the_content', get_the_content(null, false, $post['ID']));  // not really, I will explain below

Beware that you will retrieve the entire rendered HTML, I am not sure how you want to get a single paragraph from it. Either you go another way where it is enough to have the entire post, or you play around with the PHP classes DOMDocument and DOMXPath having a lot of fun with a gazillions of edge cases.

One more thing: For performance reasons, do not pass around the post ID all the time! Instead, fetch the post once:

$postobj = get_post($post['ID']);

and then pass around this object to all functions like get_the_post_thumbnail, get_the_title, get_the_content because they make a database access if an ID is passed, but do not if a WP_Post object is passed.

So, you should end up with

$content = apply_filters('the_content', get_the_content(null, false, $postobj));