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  1. Borrow

Flash Loans

Available on Mainnet

PreviousLiquidationsNextInterest Rate Model

Last updated 6 months ago

Designed primarily for developers with the requisite technical expertise, flash loans provide the capability to borrow available assets without the need for collateral, provided that the liquidity is restored to the protocol within a single block transaction.

In the realm of decentralized finance (DeFi), flash loans serve as a tool for executing intricate financial transactions. For instance, a user might opt for a flash loan to conduct a trade on a decentralized exchange (DEX) or engage in arbitrage across various DeFi protocols.

Despite their utility in enabling swift and convenient access to significant capital, flash loans entail a heightened level of risk due to their short-term nature. Should the borrower fail to repay the loan within the designated timeframe, a substantial penalty may be imposed.

To engage in a flash loan, a contract must be constructed to request the loan. Subsequently, the contract needs to execute the specified steps and repay the loan along with accrued interest and fees, all within the confines of a single transaction.

For a more in-depth understanding, refer to the flash loan procedure inherited from Aave within their .

documentation