To take out a normal loan, you need to provide proof of reserves, income, and more besides. Well, forget all that: flash loans are like lending on steroids.
But are they a good or a bad thing? That depends on who you ask. To some, because flash loans are both a hugely innovative and useful tool in decentralized finance (DeFi), primarily on the Ethereum Network. To their detractors, flash loans present an opportunity for unscrupulous actors to siphon off millions by exploiting poorly protected protocols.
Dig in and see why.
What are flash loans?
With a run-of-the-mill loan, the lender usually wants some kind of collateral to make sure they get their money back; the contract often takes a while to get approved, and the borrower pays back the loan, with interest, over a period of weeks, months or years.
Flash loans are the antithesis of that. They do what they say on the tin, and occur in an instant because the funds are both borrowed and returned within seconds—in the space of one tran
Źródło: https://decrypt.co/74496/what-are-flash-loans-the-defi-lending-phenomenon-explained
