Definition ∞ A flash loan vector refers to a specific method or pathway by which an attacker leverages a flash loan to execute a malicious exploit within decentralized finance. Flash loans permit borrowing large amounts of capital without collateral, provided the loan is repaid within the same blockchain transaction. Attackers exploit this capability to manipulate asset prices on decentralized exchanges or exploit smart contract vulnerabilities, leading to unauthorized fund extraction. This technique highlights a unique risk in DeFi architecture.
Context ∞ Flash loan vectors are a recurring topic in security analyses of DeFi protocols, underscoring the innovative yet risky nature of uncollateralized borrowing. A key discussion involves developing robust smart contract defenses and improving price oracle resilience to counteract these rapid, high-impact attacks. Ongoing research focuses on protocol design improvements that limit the attack surface exposed to flash loan manipulations.
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