Research Article
Design of "Flash Loan" under Decentralized System
@INPROCEEDINGS{10.4108/eai.23-12-2022.2329208, author={Xiaolei Ding and Lingwei Zhang and Shujuan Sun}, title={Design of "Flash Loan" under Decentralized System}, proceedings={Proceedings of the 2nd International Conference on Internet Technology and Educational Informatization, ITEI 2022, December 23-25, 2022, Harbin, China}, publisher={EAI}, proceedings_a={ITEI}, year={2023}, month={6}, keywords={decentralized system; blockchain; "flash loan"; capital loan; virtual bank}, doi={10.4108/eai.23-12-2022.2329208} }- Xiaolei Ding
Lingwei Zhang
Shujuan Sun
Year: 2023
Design of "Flash Loan" under Decentralized System
ITEI
EAI
DOI: 10.4108/eai.23-12-2022.2329208
Abstract
In recent years, the decentralization system based on blockchain has ushered in rapid development, which presents the emerging trend of replacing the traditional financial system. The "flash loan," as a more experimental decentralized lending model, can realize capital loans without collateral. Influenced by a host of unfavorable factors represented by the economic downturn, small and micro enterprises in China are progressively facing the increasingly prominent problem of "difficulty in obtaining loans." In this context, although some banks in China have launched "flash loan" products, numerous reasons, such as high thresholds and strict audits, still make it difficult for small and micro enterprises to become their target audience. Hence, this paper intends to improve the design of the existing "flash loan" products, focusing on upgrading the related data management system and risk prevention system. Additionally, by constructing the form of virtual banks, on the background data management system with high confidentiality and the operation platform with high-risk control intensity, this research distributes the background reserve funds to virtual customers in the form of imitating regular banks and ensures the independence of the supply chain when it is applied to regular banks instead of virtual banks, thus providing a valuable reference for the promotion of decentralized lending model.