Smart Contract Knowledge: To execute a crypto flash loan, you need a solid understanding of smart contracts, as they automate the loan process and ensure that all transactions are completed within a single block.
Collateral-Free Loans in crypto: flash loans don’t require collateral. However, you must repay the loan within the same transaction block, or the entire deal will be void.
Access to DeFi Platforms: You’ll need access to decentralized finance (DeFi) platforms like Aave or dYdX, which offer flash loans to users who can execute them properly.
Sufficient Liquidity: Flash loans rely on high liquidity within the DeFi platform, ensuring that there’s enough capital available for large transactions to occur without affecting market prices.
Efficient Arbitrage or Use Case: To profit from a flash loan, you must have a specific strategy, such as arbitrage or debt refinancing, to complete the required transactions quickly and successfully.
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