Flash loans are one of the most commonly used terms in the Decentralized Finance (DeFi) ecosystem. Essentially, flash loans are a type of loan that allows users to borrow or lend assets without requiring any collateral, and they must be repaid within a single block process (which can vary depending on the blockchain platform being used, such as Ethereum where there block time is 15 seconds). Flash loans have become popular because they offer opportunities for arbitrage, which involves taking advantage of price differences between different decentralized exchanges or other DeFi protocols. In essence, flash loans allow users to access instant and collateral-free funding for a short period of time, making them a key feature of the Defi ecosystem.
