Borrow Millions In DEFI With NO COLLATERAL? FLASH LOANS Explained (Aave, dYdX)

[@Finematics]

❓What do you think about flash loans? Are they good for the DeFi ecosystem? 👍Hit the like button if you enjoyed this video 🐦Follow Finematics on Twitter ► twitter.com/finematics 💛Support Finematics on Patreon and join our Discord community ► www.patreon.com/finematics

[@chillrain351]

Thank you, wonderful help.😁

[@beyonderssupreme]

Please read my suggetion comment below

[@cicher]

Excellent video! 👏👏 But, *there is an ERROR* 📛: the 0.09% of $100,000 is $90 (not $900), then the loan repay is $100,090 and the profit is *$920* 🤑

[@ToY9CiTo]

He's a Genius! 🧠

[@fakaraka9947]

Hi all, my name is Farah. Currently my son is having problems with a tumor in his head and it could possibly life threatening. I hope someone can help by donating or share this message to others. Estimated cost of the surgery is around 20,000 usd and i needed another 12,000 usd. I'm really thankful if someone can help me. Since we're from different countries around the world, crypto really useful. My husband died last year due to covid-19. Please... If you can't give much, even a little is enough for me.. I just don't want to lost anyone anymore.. Farah, Metamask id, 0x603a656bc46d4716E5e0A1a16a839ADAf2fA3739

[@KaiserKnight-bv3ru]

This is the first video that explains flash loan so clear and understandable. Your work deserve my highest respect.

[@Finematics]

Thank you! :)

[@christopherozarks6285]

These are advanced trading techniques and use cases. If you were able to comprehend all that and figure a way to use it you should be proud of yourself. I would say less than 10% of all traders even know about techniques like that - and only about 2% use them!!

[@user-bm5tw5pb1z]

…..

[@mrmatz408]

Seriously amazing videos! I think you are the only one explaining things with the amount of detail that I can understand.

[@TjSpoonManJacques]

I had six questions on my notepad prior to this video and all six were answered. Freaking amazing! The thorough explanation of anything presented on KZbin! For real for real because I was confused AF 🤣

[@mundoalonso-cuevillas6712]

100% agree! I’m an engineer (not a very good one though), and this is the first time I truly understand a DeFi operation.

[@TjSpoonManJacques]

@@mundoalonso-cuevillas6712 be on the lookout for the gas prices which are making flash loans extremely difficult. Ended a profit I haven't landed a profitable flashlight in over a month 😔

[@goldenboatcaptain]

This channel is going to explode with this bullrun. One of the best crypto channels on YT. Keep it up, man. Love your work.

[@Finematics]

Thanks! Appreciate that :)

[@ksiadzgrzesiu69]

Are you kidding? No one is doing research 😂

[@nonenone4461]

Notice that all Cryptos crashed over the 8 months this was posted.

[@fullslippery]

8:30 1. "Take a Flashloan in DAI to cover the amount of DAI that was borrowed" 2. "Repay your Compound loan with borrowed DAI" 3. "Withdraw your ETH" 4. "Swap your ETH for BAT on Uniswap" 5. "Supply BAT as collateral on Compound. Borrow DAI against your BAT collateral" 6. "Repay Flashloan with borrowed DAI plus fees" "Congrats, you just swapped your collateral from ETH to BAT and paid 0.09% of the borrowed amount for this"

[@noillusion3180]

So it’s completely pointless

[@shreyashandiyekar7135]

Thanks for keeping me updated with all this new stuff.

[@Finematics]

You're welcome!

[@ameen2428]

Highly informative. Thank you, keep on doing this. Love♥️

[@Finematics]

Thanks a lot! :)

[@samuelaavila8285]

Sometimes when I watch your videos I still don't understand quite everything due to the sheer amount of detail of your content and me being pretty new to defi. However, for many of your videos with time in the crypto market I can come back to them and they make complete sense. Thank you for the educational content, it's very good.

[@samooxa]

You deserve all the praise man, your channel will moon soon. Congrats & Thank you.

[@Finematics]

Thanks!!

[@LookMomNoHands22]

Please never stop making videos. You and the team are absolutely amazing. Thank you for making the educational journey of DeFi so enjoyable. Once we moon, I’ve got you on some cool project tokens. Promise.

[@muhammadkashif2944]

Finally , someone with a great knowledge . Respect for you !!

[@Finematics]

thank you!

[@tjc9995]

This is such an awesome channel. Great videos and clear explanations. One question: how are you producing and recording these whiteboards?

[@castro420]

I love your videos, DeFi is a confusing subject this was a very great explanation.

[@Finematics]

thanks! :)

[@WiLDeveD]

This is the best and detailed Explanation of Flash loans i've ever saw. Thanks bro and God Bless.

[@cptn3mo623]

I think I am speaking for the large majority when I say this - you are an incredible help to Beginners / Intermediates wanting to learn more in the crypto space and we are hugely grateful and thankful! Subscribed and have notifications on, keep it up!

[@Finematics]

thank you! 🙌

[@vanillakush4737]

U made me even more in love with defi and is system. Great content,thanks !

[@marcusaurelieus9055]

Great video man ! Really enjoyed it and felt like I fully understood flashloans for the 1st time despite reading in so many places. I think your channel will 100% grow man , keep hustling !

[@Finematics]

Thanks!! Great to hear the video was helpful :)

[@pkqs9065]

This is gold. Very clearly explained, thanks for the video!

[@Finematics]

Thanks! :)

[@anakinskywalkerrr]

This is the best video to understanding flash loan

[@Finematics]

thanks!

[@resulfuruncu1952]

Kind of feel dumb that i still don’t understand the way a flash loan works, even after this guys video lol

[@nicots]

Excellent explanation. I hope this channel continues to grow!

[@Finematics]

Thanks! I hope so too :)

[@warrenwaugh6034]

I like the fact that anyone can take advantage of this. Well explained good video. My minds blown away.

[@banzobeans]

Top notch video as usual!!! Thx

[@RsAsksWhy]

Excellent content and explanation, keep em coming, destroyed the like and subscribe buttons!

[@Finematics]

Thanks!!

[@smoooon8889]

I am learning so much with your videos and of course I am subscribing your channel. Some are still difficult to understand 100 % but your contents are super well explained and not so biased which I like so much. it is truly helpful. Keep it up! and thank you!!!

[@Finematics]

Thanks a lot! Glad to hear the videos are helpful :)

[@TjSpoonManJacques]

DAMMIT THAT WAS AMAZING!!! I HAD SO MANY QUESTIONS PRIOR TO THIS VIDEO! THANK YOU MUCH LOVE FROM NEW ORLEANS ❤️💪

[@Finematics]

Thank you!! :)

[@bobperson1173]

So clear, concise, and great examples!

[@simonhansen8205]

This is extremely clear. I now understand. Thank you very much.

[@jeremygonzalez4501]

Fascinating. So many things clicked and thoroughly explained. Thank you!

[@vanillasf]

Amazing content. Impressive to see how banking today looks like the dinosaur age compared to DeFi...

[@udaybabbu13]

this guy is a Genius ...

[@cloudshad0ws]

Great video... Unfortunately, my experience (messing around with aave at least), gas fees the way they are right now it seems pretty difficult to actually utilize flash loans profitably with one of these legitimate ways...

[@abc_12333]

Try MULTIPLIER (a fork of Aave) on Binance Smart Chain. Gas fees are ONLY 5 Gwei

[@cryptorajan4701]

Nice video!!very informative.

[@asmitadhungana3790]

Your channel is pure Bitcoin! ;) Keep on delivering the rich contents :D

[@Finematics]

Thanks! :)

[@amandac3658]

Amazing explanation, thank you

[@nachobeats4733]

Love your vids mate. I would really like to know your opinion on deflationary farming. Keep teaching us about DeFi

[@Basil__X]

Loved the explanation, thanks!

[@Finematics]

thanks :)

[@WibbilyWobblyWonder]

Thanks for making! Top tier education vids

[@gl897]

You've got a new subscriber since I could never understand how they work p

[@DynamicJon]

Kind of a dumb question but if it requires repayment within the same ETH transaction, how much time do you have to do the repayment, must it be within seconds?

[@lr_law4940]

About 13-14 seconds if i am not mistaken

[@atbrightone5724]

@@lr_law4940 how tf do you payback in 3 secs?

[@atbrightone5724]

13*

[@lr_law4940]

@@atbrightone5724 you don’t the program do. You manually couldn’t do it. Imagine it like the money you borrow never stops at one place. It just runs a circle. Lender->you->exchange1->exchange2->you->lender. The lender is the start and the finish. Everything in between is just a checkpoint and(if the flash loan is successful) the money picks up a bag(which is your profit) at exchange2 and drops it at you before it arrives to the finish line(lender)

[@javierortizmir7873]

These explanations are great!!

[@Finematics]

Thanks!

[@prackertracker7189]

8:25 Why do we neet a flash lone here? coudln't we just repay the debt by our borrowt DAI instead of taking a flash loan, to avoid the first 3 steps?

[@Acilias]

Great video once again ! Make one on ethereum rollups please (optimistic, zk rollup etc.)

[@Finematics]

Thanks, great suggestion. I have this topic on my list of things to cover :)

[@katyaolivan6085]

Very well explained!!

[@Finematics]

thanks!

[@geneshen6405]

Great video. But for this concept to really take off, there has to be way more streamlining involved.

[@cyclopa]

Amazing clear and detailed video + drawings/animations! 💯 PS: Are you drawing all this yourself too?😯 On some kind of digital canvas, connected to your pc?

[@martinwinter4840]

great vid brotha

[@Finematics]

thanks!

[@mynameiszoro]

Great video mate! As a viewer I would like to request a video about Mempool bots and front runners. What do you think?

[@Finematics]

Thanks! Yes, this is definitely one of the topics to cover in the future :)

[@mynameiszoro]

@@Finematics Also If you can include how to include the transaction without the mempool if you are a miner. That would be great ! Thanks mate

[@holden2966]

Briliant! thank you very much

[@becks0303]

For the use case on collateral swap - whats the point of doing this 6 step process to swap my ETH to BAT ? If the objective is to just get ETH to BAT, can't I just literally do step 5 (using my ETH and swapping it for BAT at any AMM ? ) to achieve that ? Why do we need all 6 steps ?

[@Finematics]

Because the coins are used as collateral and are locked in the protocol. They cannot be just swapped.

[@becks0303]

Thanks. But didnt we already withdraw that collateral from compound in step 3?

[@21rejones]

I'm not sure the maths is right on the arb example. The Aave fee is 0.09%, no? Making the fee on a $100,000 loan $90? This makes the profit $920. Am I crazy?

[@Finematics]

Yes, you are correct. I usually double check all the maths, but this one was too simple right? :( I made a correction in the subtitles. Thanks for spotting.

[@arctuuruus]

So the 90 dollar fee is the gas price of swapping all the different currencies right?

[@iranastarr1598]

Last one month I trying to get borrow(loan)by Huobi&Definitely through digital assets exchange through. And I became tired coz of unknown systems. Now I want to listen it again&again to get a loan by FLASH(DEFI)

[@johnkwok6524]

This is great as so many of your videos are! Wondering if you could do one that delves into arbitrage? Thank you for all of your work so far!

[@Finematics]

Thanks! Yes, I will be delving deeper into multiple topics including arbitrage :)

[@AbstractAbsorption]

Hi @Finematics, your "How to code a Flash Loan with AAVE" link takes you to an empty post on the blog. Is there a new one?

[@jahmoncrypto2781]

Very informative!!!

[@Finematics]

Glad it was helpful!

[@robinng5404]

Nice info,,and plz put timestamps

[@JohnnieTycoon]

Great and interesting video.

[@Finematics]

thanks!

[@fleuriadon7765]

Awesome ! Thank you so much

[@evgeniy_moscow_gooner]

I don't understand what the point of collateral swap is. You simply swap one crypto for another to borrow DAI while you could borrow it without swapping. UPD It actually appears that you pay a commission and lose your ETH.

[@tijesuniogunrombi9456]

Maybe you didn't anticipate a value drop in your initial collateral used?

[@marcio7708]

You are the best teacher! Thank you!

[@Finematics]

Thanks!! :)

[@jennachang3269]

Awesome! Thank you :)

[@TheFluffyFix]

Terra anchor was an amazing idea

[@ludacris6600]

But i have seen in other videos that you have to access a site/platform where you ask for the loan, and the interface does all the work you inky have to allow transaction. Where do you browse to?

[@morgie8907]

Can you do a video on the best wallets for storing cryptocurrency?

[@amitdubey9201]

One query is flash loan still supported by aave for arbitrage using a bot

[@Pritchy__]

I have a question around this... suppose you take out a flash loan and then use the token to purchase something (let's say some random product that allows for purchase with a token) and then you refuse to pay back the loan. Since you now obtain this new product, how can this transaction be rolled back? Does the transaction when purchasing the product not get verified until you repay the loan?

[@onekycarscanners6002]

You need to understand atomic transaction. All or none

[@Elmercuaton]

I click the first link it open in the crypto.com but it's nothing there you said i can loan defi coin without colateral?

[@workstationguy]

@9:30 Why would your ETH be "restored" by repaying a failing DAI loan with another flash loan? Wouldn't ETH collateral that is falling in value remain the same value regardless?

[@workstationguy]

Or is the point that you simply avoid paying liquidation fees

[@oksmith5171]

Great content as usual. Where can we download the drawing boards?

[@Finematics]

Thanks, it's not possible to download the drawing boards, it's a project within the Videoscribe app

[@Mrtranquil01]

In the second usecase, whats the advantage of doing that over just swapping the ETH for BAT on uniswap before getting ?

[@lioruzan2048]

Excellent video

[@andreachiesa5563]

Super interesting content

[@Finematics]

thanks!!

[@joannechen6850]

Can you make a video about Margin Trading?

[@theflipside2709]

Nice vid, again! Q - How long can one use the flash loan for before they have to repay?

[@Finematics]

Thanks, you only have 1 transaction time which is the same as 1 block time which is around 10-17 seconds on average

[@theflipside2709]

@@Finematics Huh? How can one operate that many steps in 10-17 sec's time??

[@Finematics]

As mentioned in the video this feature is predominantly used by software developers, so it can be programmed that way. Furucombo also can create a transaction with multiple steps for non-developers

[@theflipside2709]

@@Finematics Thank you!

[@videospride8439]

Please make a video teaching how to borrow

[@jljl6485]

incredible video oO

[@Finematics]

thanks!

[@سرالحضارات-ي4ق]

How I can make sure profits will be more than gas Fees of borrow flash loan

[@EnioPlowden]

I really appreciate your efforts! I need some advice: My OKX wallet holds some USDT, and I have the seed phrase. (alarm fetch churn bridge exercise tape speak race clerk couch crater letter). How should I go about transferring them to Binance?

[@aboodabood440]

Great video! But how to bypass the Mempool and the bots all together and include your transaction in a block if you are a miner? is that possible?

[@Finematics]

Good question. Yes, I you are a big miner (or if you know one) you could include a transaction in a block that was never in the mempool, basically avoiding the mempool snipping bots

[@ocupado658]

Cool videos mate, not just the content but also the animations you use. However, there's one thing in this one I dont quite understand - how can one ethereum transaction consist of multiple steps? Do I have to be able to code for that? How do I not know this

[@Finematics]

yes you can code that, you can write a function that interact with a lot of different protocols within the same Ethereum transaction

[@ocupado658]

@@Finematics okay. well, guess it's time to get into solidity then. thanks for replying!

[@devsutong]

Whats the use of Collateral swap?

[@agentlier6974]

Woww.. You are good man...

[@unknownmatrix8424]

i saw your trademark presentation style in one vid of Bankless. are you one and the same, or just a collaboration? nice informative vids i am not wrong to subscribe. Thank you for spreading the financial education to clueless and newbies in crypto like me.

[@Finematics]

Yes, it was just a collaboration :)

[@quinnxy]

great content

[@Finematics]

thanks!

[@ABCDEFGH-or2eb]

I don’t have money to cover the gas fees. Does that mean I can’t get a flash loan?

[@cyclopa]

Amazing clear and detailed video + drawings! I will subscribe and follow on Twitter immediately 💯 PS: Are you drawing all this by yourself too?😯 On some kind of digital canvas, connected to your pc?

[@Finematics]

Thank you! I use software for this - it's called Videoscribe

[@cyclopa]

@@Finematics Interesting, will look it up for sure!

[@chmitoxd]

4:40 start.

[@ritikgulabrani9073]

We need a video comparison b/w binance smart chain and ethereum !??

[@iliavko]

So does this mean that the smart contract has to detect that the arbitrage opportunity exists in order to lend the funds in first place?.. Because this seems to be a riskless loan and that is impossible. There must be a counterparty risk involved, otherwise the interest received by the lender also makes no sense, why would you get a reward for something that represents no counterparty risk?.. I am a person from traditional finance and this makes no sense to me lol

[@Quantumfishics]

How do I make sure I repay on the same transaction block?

[@ernieschatz3783]

It's structured that way

[@matiasss550]

It was not a hack, no user was compromised neither platforms. User used protocols correctly.

[@cutflow2]

Is AAVE the only crypto offering flash loans ?

[@Dannydrinkbottom]

Love the concept but too much work for me😂

[@valemerlot]

I still don’t get why there’s no risk of not repaying?

[@Finematics]

Imagine each Ethereum block being a minimal, indivisible unit of time. Both borrowing and repaying have to happen in the same transaction hence in the same block. It means that basically borrowing and repaying have to happen at the same time. If at the end of all of your actions you're not able to replay the loan, the whole chain of events is invalidated including you taking the loan in the first place.

[@LeTran-vh6qj]

@@Finematics As my understanding, if the user could not repay the loan in the same block, that user also cannot get the loan because the loan is invalid. However, I am confused that how people can make multiple transactions (such as: borrow, sent to new address, swap, and so on) during the same block? Per my experiences, sending ETH also take minutes to complete the transaction. I really want to understand it from your feedback. I am sorry if my English cause misunderstanding.

[@valemerlot]

Finematics is that mean the transaction that I want to do with the loan needed to be in the same transaction too?

[@Finematics]

@@LeTran-vh6qj when you're sending ETH your wallet broadcasts the transaction to the network. After that, your transaction has to be picked up from the mempool by a full node and mined. That's why it usually takes some time between sending and seeing the balance change. Similarly, you can send a transaction with multiple steps. What happens under the hood is a full node picks up your transaction from the mempool at some point (depending on the gas price) and starts executing all the instructions one by one. These instructions are executed by the EVM (Ethereum Virtual Machine). At these point you're not competing with any other users as the EVM executed transactions one by one. At these point if you execute a swap on Uniswap and the price has changed from the time when you were submitting a transaction the swap can fail and cause the whole transaction to be rolled back.

[@Finematics]

@@valemerlot yes, exactly

[@the_guy_with_yeeyee_a_haircut]

i have a question, could Crypto Flash Loans be used for a pump and dump scheme? for an example ; i get a Crypto Flash Loan for 1.000.000 uniswap from AAVE and take it and sell of it would that cause the price of Uniswap to drop ???

[@zybexgaming2910]

i dont understand if you need to repay it back instantly why borrow it in the first place?

[@Rompelarueda]

Explain SmartBCH! The EVM sidechain just launched on BCH that scales ethereum. Up to 1 billion gas every 10 seconds, totally decentralized (no own token, no premine etc), backed by PoW (SHA-256)

[@PraizeTochiugo]

Do you know any site for flash loan's? I'm only seeing scam ones . Thanks

[@nikolaoskalivas8308]

Awesomeeee duuudeeeeee

[@from2ureview251]

10000 dai on a 0.09% fee is Technically 100 dai so the user is left with 910 dai profit, right?