Flash loan
An uncollateralised loan that must be borrowed and repaid in the same transaction — atomic, or it reverts.
Flash loans enable arbitrage, collateral swaps, and liquidations. They're also the typical setup for Oracle manipulation exploits (move price → liquidate / borrow → restore). Aave and Balancer offer the deepest flash-loan liquidity.
Related terms
- ArbitrageA trade that exploits a price difference between venues for the same asset, ideally with little to no market risk.
- Oracle manipulationAn exploit class where an attacker moves the price an oracle reports, then triggers favourable liquidations / mints.
- LiquidationForced sale of collateral when a borrower's health factor falls below the protocol's threshold.