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What Is a “Flash Loan” and How Does It Relate to Market Manipulation Risks on DEXs?

A flash loan is an uncollateralized loan repaid in one transaction; it can be used to manipulate DEX price oracles, posing a systemic risk.
Greeks.Live12.11.25

What Is a “Flash Loan” and How Does It Relate to Market Manipulation Risks on DEXs?

A flash loan is an uncollateralized loan that must be borrowed and repaid within the same blockchain transaction. While innovative, flash loans can be used to execute rapid, high-volume arbitrage or, more dangerously, to manipulate the price oracle of a DEX or lending protocol.

This manipulation often involves a temporary, massive price shift that is exploited for profit, posing a systemic risk to DeFi protocols.

What Is a Flash Loan and How Can It Be Used to Amplify a Reentrancy Attack?
Can a Sybil Attack Be Used to Manipulate the Price of a Derivative?
How Can an Oracle Be Manipulated in a “Flash Loan” Attack Scenario?
How Do Flash Loans in DeFi Work and What Are Their Primary Use Cases?

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