Description: Flash arbitrage is a trading strategy in the decentralized finance (DeFi) space that allows users to take advantage of price discrepancies of the same asset across different exchanges within a single transaction. This practice is based on the capabilities of smart contracts on the blockchain, which enable the execution of multiple operations instantaneously and without intermediaries. Flash arbitrage is characterized by its speed and efficiency, as traders can buy an asset at a lower price on one exchange and sell it at a higher price on another, thus making a profit. However, this strategy requires a deep understanding of the market and the trading platforms, as well as precise execution for the transaction to be profitable. The relevance of flash arbitrage lies in its ability to balance asset prices across different platforms, contributing to market efficiency and liquidity in the DeFi ecosystem. Additionally, since it is a practice carried out in a single blockchain block, it minimizes the risk of price fluctuations during the arbitrage process, making it an attractive option for experienced traders looking to maximize their profits in a highly volatile environment.
