Flash Loan

GLOSSARY PSEO / WEB3 GLOSSARY

Flash Loan

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An uncollateralized loan that must be borrowed and repaid within the exact same atomic blockchain transaction block.

How this mechanic works

Introduced by Aave, flash loans enable multi-million dollar capital access without upfront collateral, conditioned on the atomic return of principal plus interest before block inclusion. If the borrower fails to repay, the entire transaction reverts as if it never occurred.

Related terms

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