Flash Functionality

Flash Mint

Nectra offers a "flash mint" feature that allows anyone to borrow unlimited nUSD without providing collateral. The borrowed amount and a fee of 0.25% (paid to the Savings Account module) must be returned within the same transaction. To ensure system stability during a flash mint, redemptions, Savings Account deposits (to avoid JIT attacks), and liquidations are temporarily blocked.

A key benefit for borrowers is the ability to repay debt and withdraw cBTC collateral in a single transaction without needing the upfront nUSD required. For example, a user can flash mint nUSD, repay their loan, withdraw cBTC, and then sell that cBTC for nUSD within the same transaction to settle the flash mint and its fee, allowing efficient debt and collateral management.

Flash Borrow

Nectra also offers a “flash borrow” function, allowing users to atomically borrow the underlying cBTC collateral for a 0.25% fee (paid to the Savings Account module), provided it's repaid within the same transaction. As highlighted in the leverage section, this feature allows positions to increase their cBTC exposure without the need for a nUSD-to-cBTC swap loop, making it more efficient by saving on gas and potentially DEX fees.