Flash Loan Attack

Noun · Security & Infosec

Definitions

  1. A decentralized-finance exploit that uses a flash loan to borrow large amounts of capital within one transaction, manipulate a market or protocol condition, and repay the loan before the transaction ends. Flash loan attacks often target pricing oracles, liquidity pools, or flawed contract logic rather than traditional authentication weaknesses.

    In plain English: A crypto exploit that briefly borrows huge funds to manipulate a DeFi protocol and profit before repaying the loan.

    Example: "The protocol lost millions in a flash loan attack that manipulated the oracle price for a single block."

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