Overview
A flash swap is an AMM feature that lets users withdraw tokens before paying for them within one transaction. It is an uncollateralized borrowing enabled by atomic execution. If the trade is not completed, the transaction reverts.
How It Works
A user calls the pool to receive tokens, then uses them in the same transaction before repaying with a fee. The pool checks repayment at the end. This enables arbitrage and capital-efficient strategies.
Why It Matters
Flash swaps let anyone access large liquidity without capital, powering arbitrage and MEV strategies. They also expose pools to manipulation risk. They are a powerful AMM primitive.
Related Concepts
Flash swaps relate to AMMs, Flash Loans, and MEV. They are a form of atomic, uncollateralized credit.