research-article

Towards A First Step to Understand Flash Loan and Its Applications in DeFi Ecosystem

Authors:

Xingliang Yuan,

Kui RenAuthors Info & Claims

SBC '21: Proceedings of the Ninth International Workshop on Security in Blockchain and Cloud Computing

Pages 23 - 28

https://doi.org/10.1145/3457977.3460301

Published: 25 May 2021 Publication History

Abstract

Flash Loan, as an emerging service in the decentralized finance ecosystem, allows users to request a non-collateral loan. While providing convenience, it also enables attackers to launch malicious operations with a large amount of asset that they do not have. Though there exist spot media reports of attacks that leverage Flash Loan, there lacks a comprehensive understanding of existing Flash Loan services.

In this work, we take the first step to study the Flash Loan service provided by three popular platforms. Specifically, we first illustrate the interactions between Flash Loan providers and users. Then, we design three patterns to identify Flash Loan transactions. Based on the patterns, 76,303 transactions are determined. The evaluation results show that the Flash Loan services get more popular over time. At last, we present four Flash Loan applications with real-world examples and propose two potential research directions.

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Cited By

Wang CLi PZeng YFan XDastani MSichman JAlechina NDignum V(2024)Optimal Flash Loan Fee Function with Respect to Leverage StrategiesProceedings of the 23rd International Conference on Autonomous Agents and Multiagent Systems10.5555/3635637.3663050(1874-1882)Online publication date: 6-May-2024
https://dl.acm.org/doi/10.5555/3635637.3663050
Saravanakrishnan VNandhini MPalanivelu P(2024)DeFi's Transformative Influence on the Global Financial LandscapeDigital Technologies, Ethics, and Decentralization in the Digital Era10.4018/979-8-3693-1762-4.ch006(99-120)Online publication date: 8-Feb-2024
https://doi.org/10.4018/979-8-3693-1762-4.ch006
Al-Zubaidie MJebbar W(2024)Providing Security for Flash Loan System Using Cryptocurrency Wallets Supported by XSalsa20 in a Blockchain EnvironmentApplied Sciences10.3390/app1414636114:14(6361)Online publication date: 22-Jul-2024
https://doi.org/10.3390/app14146361
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Index Terms

Towards A First Step to Understand Flash Loan and Its Applications in DeFi Ecosystem
1. Security and privacy

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Published In

cover image ACM Conferences

SBC '21: Proceedings of the Ninth International Workshop on Security in Blockchain and Cloud Computing

May 2021

40 pages

ISBN:9781450384056

DOI:10.1145/3457977

Program Chairs:
Jian Liu
Zhejiang University
,
Shweta Shinde
ETH Zurich

Copyright © 2021 ACM.

Permission to make digital or hard copies of all or part of this work for personal or classroom use is granted without fee provided that copies are not made or distributed for profit or commercial advantage and that copies bear this notice and the full citation on the first page. Copyrights for components of this work owned by others than ACM must be honored. Abstracting with credit is permitted. To copy otherwise, or republish, to post on servers or to redistribute to lists, requires prior specific permission and/or a fee. Request permissions from [email protected]

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Publication History

Published: 25 May 2021

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Leading Innovative and Entrepreneur Team Introduction Program of Zhejiang
Fundamental Research Funds for the Central Universities

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ASIA CCS '21

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SIGSAC

ASIA CCS '21: ACM Asia Conference on Computer and Communications Security

June 7, 2021

Virtual Event, Hong Kong

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Cited By

Wang CLi PZeng YFan XDastani MSichman JAlechina NDignum V(2024)Optimal Flash Loan Fee Function with Respect to Leverage StrategiesProceedings of the 23rd International Conference on Autonomous Agents and Multiagent Systems10.5555/3635637.3663050(1874-1882)Online publication date: 6-May-2024
https://dl.acm.org/doi/10.5555/3635637.3663050
Saravanakrishnan VNandhini MPalanivelu P(2024)DeFi's Transformative Influence on the Global Financial LandscapeDigital Technologies, Ethics, and Decentralization in the Digital Era10.4018/979-8-3693-1762-4.ch006(99-120)Online publication date: 8-Feb-2024
https://doi.org/10.4018/979-8-3693-1762-4.ch006
Al-Zubaidie MJebbar W(2024)Providing Security for Flash Loan System Using Cryptocurrency Wallets Supported by XSalsa20 in a Blockchain EnvironmentApplied Sciences10.3390/app1414636114:14(6361)Online publication date: 22-Jul-2024
https://doi.org/10.3390/app14146361
Li WLi XZhang YLi ZChua TNgo CKumar RLauw HKa-Wei Lee R(2024)DeFiTail: DeFi Protocol Inspection through Cross-Contract Execution AnalysisCompanion Proceedings of the ACM Web Conference 202410.1145/3589335.3651488(786-789)Online publication date: 13-May-2024
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Wang BYuan XDuan LMa HWang BSu CWang W(2024)DeFiScanner: Spotting DeFi Attacks Exploiting Logic Vulnerabilities on BlockchainIEEE Transactions on Computational Social Systems10.1109/TCSS.2022.322812211:2(1577-1588)Online publication date: Apr-2024
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Iqbal MChiarelli AMatulevičius R(2024)Bridging Two Worlds: Framework for Secure Implementation of Blockchain Oracles2024 IEEE International Conference on Software Analysis, Evolution and Reengineering - Companion (SANER-C)10.1109/SANER-C62648.2024.00008(12-22)Online publication date: 12-Mar-2024
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Xiong XWang ZWang Q(2024)Exploring the Market Dynamics of Liquid Staking Derivatives (LSDs)2024 IEEE International Conference on Blockchain and Cryptocurrency (ICBC)10.1109/ICBC59979.2024.10634417(334-342)Online publication date: 27-May-2024
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Puschmann THuang-Sui M(2024)A taxonomy for decentralized financeInternational Review of Financial Analysis10.1016/j.irfa.2024.10308392(103083)Online publication date: Mar-2024
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