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How Does a Time-Weighted Average Price (TWAP) Help Defend against Price Feed Attacks?

By averaging the price over a time period, TWAP negates the impact of instantaneous, short-lived price manipulation attacks like flash loans.
Greeks.Live20.11.25

How Does a Time-Weighted Average Price (TWAP) Help Defend against Price Feed Attacks?

A Time-Weighted Average Price (TWAP) is a method that calculates the average price of an asset over a specific period, rather than taking the price at a single moment. This mechanism effectively smooths out any sudden, short-lived price spikes or drops caused by manipulation attempts, such as those executed via flash loans.

Since a flash loan attack is instantaneous, the momentary manipulated price has minimal impact on the overall calculated average, thus protecting the smart contract.

What Are the Potential Consequences of Setting a TWAP Time Period That Is Too Short or Too Long?
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