What is Flash Loan?
Last reviewed 2026-05-03
A flash loan is an uncollateralized loan that must be borrowed and repaid in the same transaction, atomic on the EVM. Pioneered by Aave 2020. Used for arbitrage, collateral swaps, refinancing, liquidations — and also for many exploits, since attackers can borrow $100M+ for a single block.
How it works
A flash loan is an uncollateralized loan that must be borrowed and repaid in the same transaction, atomic on the EVM. Pioneered by Aave 2020. Used for arbitrage, collateral swaps, refinancing, liquidations — and also for many exploits, since attackers can borrow $100M+ for a single block.
For deeper protocol-level mechanics, see the related glossary terms below or the linked DeFi Intel topic deep-dive.
Why it matters
Flash loans democratize capital — anyone can move $100M for one block. They power arbitrage, refinancing, and (unfortunately) most large DeFi exploits.
Real-world examples
Aave flash loans (Euler exploit recovery), Balancer flash loans, Morpho callback liquidity. Used for arbitrage, refis, and (sadly) exploits.
Related terms
Go deeper
Read the full DeFi Intel topic deep-dive or browse the complete crypto glossary.
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