A flash loan uses EVM atomicity: borrow any amount, do anything with it in the same transaction, and repay (plus a small fee, typically 0.09% on Aave) before the transaction ends. If you cannot repay, the entire transaction reverts — including the borrow — so the lender is always made whole.
The killer use case is atomic arbitrage between DEXes. The demo borrows 1M, runs a fictional 1% arbitrage, repays principal + fee, and pockets the profit.
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<body style="background:#06040d;color:#e6e0ff;font-family:monospace;padding:20px"><pre id="o"></pre>
<script>
const FEE_BPS = 9; // 0.09% Aave
function flashLoan(amount, useFn){
const fee = amount * FEE_BPS / 10000;
const needRepay = amount + fee;
const returned = useFn(amount);
if(returned < needRepay) throw new Error('FLASH_LOAN_NOT_REPAID (need ' + needRepay + ', got ' + returned + ')');
return { fee, profit: returned - needRepay };
}
function arbitrage(capital){
const dexAPrice = 100, dexBPrice = 101; // 1% gap
return capital * (dexBPrice / dexAPrice); // buy on A, sell on B
}
const r = flashLoan(1000000, arbitrage);
document.getElementById('o').textContent = [
'borrow 1,000,000 → run arbitrage → repay 1,000,900',
'',
' fee paid: ' + r.fee.toLocaleString() + ' (0.09%)',
' profit: ' + r.profit.toLocaleString() + ' (after fee)',
'',
'atomicity: if arbitrage returned < 1,000,900 the whole tx reverts → lender safe'
].join('\n');
</script></body></html>