The Flash Loan feature allows taking instant loans from lending protocols without collateral on the condition that the debt is repaid within the same transaction. In the context of arbitrage, this makes it possible to execute large arbitrage operations (even for 5000 SOL), even if the user's wallet has only 0.1 SOL.
How it works
1
Loan request
We borrow the required amount from the selected lending protocol.
2
Arbitrage execution
Borrowed funds are used for the arbitrage operation within the same transaction.
3
Loan repayment
The loan amount with fees is returned to the protocol at the end of the transaction.
Thus the user does not need to keep a large SOL balance in the wallet: even with a minimal amount they can perform large-scale arbitrages using instant loans for liquidity.
Costs
Loan fee – a small percentage of the amount (for example, 500 SOL → 0.005 SOL).
Compute Units — using a flash loan increases the transaction CU — its priority decreases.
