PANews reported on April 8 that according to Cryptoslate, the Bank of Canada released an internal research discussion document on March 21 to analyze flash loans and their policy relevance and potential risks. The research report defines flash loans as blockchain-native financial instruments that allow users to borrow crypto assets without collateral, provided that the loan is repaid within a single atomic transaction. It is worth noting that such internal discussion documents represent the complete research results of the central bank on important topics and fall within the Bank of Canada's broad responsibilities to assess the impact of emerging technologies on financial stability and market structure.
Report author Jack Mandin pointed out that although flash loans are currently limited to blockchain networks, their underlying concepts can be extended to tokenized financial infrastructure if they meet technical conditions. Such concepts include atomic risk-free lending, which may give rise to new systems that support atomic transactions and programmable assets. The study also raised financial stability risks. If financial institutions begin to integrate smart contract lending, it may directly cause risks. In addition, when blockchain assets (including assets involved in flash loan activities) are embedded in traditional financial products (such as exchange-traded funds), systemic risks may arise.
