Flash Loan
The Bucket Protocol consists of two main pools: the Bucket and the Tank. The Bucket collects user-deposited collateral, and the Tank houses BUCK from contributors. Arbitrageurs can take flash loans from these pools for profit.
For instance, if BUCK's price drops 5% below its peg on a decentralized exchange (DEX), a user can borrow SUI from the SUI Bucket, buy discounted BUCK on the DEX, and redeem the BUCK for SUI to repay the original SUI loan, gaining extra SUI. This is possible because of the protocol's oracle-based redemption ratio. This flash loan can be processed in one transaction, negating the need for user collateral.
Flash Loan to Get $SUI for buying cheaper $BUCK on DEX → Redeem $BUCK for $SUI
Flash loans aren't free, but they're affordable with a 0.05% fee, which is given to stBKT holders. Remember, when using flash loans for arbitrage, your potential profit should outweigh the 0.05% fee.
Last modified 5mo ago