Flash loans allow users to borrow large amounts of liquidity from the protocol.
It is possible to adjust the stable rate up or down by momentarily removing or adding large amounts of liquidity to reserves.
This type of manipulation is difficult to prevent especially when flash loans are available.
Aave should monitor the protocol at all times to make sure that interest rates are being rebalanced to sane values.
- ConsenSys Audit Aave V2 Finding 5.6
- Flash Loans
- Flash Loans -> Interest Rate Fluctuations
- Moniter -> Rebalanced Interest Rate