Flash Loan
A flash loan lets anyone borrow millions with zero collateral — provided the loan is repaid *within the same transaction*. If repayment fails, the whole tr
A flash loan lets anyone borrow millions with zero collateral — provided the loan is repaid *within the same transaction*. If repayment fails, the whole transaction reverts as if it never happened. Aave pioneered them; attackers love them for funding million-dollar exploits from nothing.
Why it matters
Flash loans democratized attacks: no capital needed, just a clever exploit. Most nine-figure DeFi hacks used one — borrowing huge, manipulating an oracle or pool, repaying, and pocketing the difference in seconds. For users, the lesson is indirect but vital: unaudited protocols holding your funds can be drained by anyone with an internet connection and an idea.
Related terms
DeFi · smart contract ·
liquidation