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The Flash Loans SDK enables capital-efficient collateral swaps using Aave V3 flash loans integrated with CoW Protocol’s intent-based trading for optimal execution.

​
Installation

npm install @cowprotocol/sdk-flash-loans @cowprotocol/sdk-trading
# or
pnpm add @cowprotocol/sdk-flash-loans @cowprotocol/sdk-trading
# or
yarn add @cowprotocol/sdk-flash-loans @cowprotocol/sdk-trading

​
How It Works

  1. The SDK initiates a flash loan from Aave Protocol V3 to borrow the required assets
  2. The borrowed assets are swapped to the desired collateral using CoW Protocol’s batch auction system
  3. Pre and post-execution hooks deploy adapter contracts and manage the entire swap flow
  4. The flash loan is automatically repaid with fees, completing the atomic transaction

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Why Use Flash Loans?

  • Capital Efficiency - No upfront capital needed for collateral swaps
  • Atomic Execution - Borrow, swap, and repay in a single transaction
  • Gas Optimization - Optimized hook architecture minimizes gas costs
  • Aave Integration - Leverages Aave V3’s deep liquidity pools
  • CoW Protocol Benefits - MEV protection through batch auctions

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Constructor

import { AaveCollateralSwapSdk } from '@cowprotocol/sdk-flash-loans'

// Default configuration
const flashLoanSdk = new AaveCollateralSwapSdk()

// Custom gas limits
const flashLoanSdk = new AaveCollateralSwapSdk({
  hooksGasLimit: {
    pre: 500000n,
    post: 800000n,
  },
})
​
options
AaveCollateralSwapSdkOptions
Optional SDK configuration

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Methods

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collateralSwap

Execute a complete flash loan-based collateral swap with automatic approval handling.
​
params
CollateralSwapParams
required
Swap parameters
​
tradingSdk
TradingSdk
required
Initialized TradingSdk instance
import { AaveCollateralSwapSdk } from '@cowprotocol/sdk-flash-loans'
import { TradingSdk } from '@cowprotocol/sdk-trading'
import { SupportedChainId, OrderKind } from '@cowprotocol/sdk-config'

const flashLoanSdk = new AaveCollateralSwapSdk()

const result = await flashLoanSdk.collateralSwap(
  {
    chainId: SupportedChainId.GNOSIS_CHAIN,
    tradeParameters: {
      sellToken: '0xe91D153E0b41518A2Ce8Dd3D7944Fa863463a97d', // WXDAI
      sellTokenDecimals: 18,
      buyToken: '0x2a22f9c3b484c3629090FeED35F17Ff8F88f76F0', // USDC.e
      buyTokenDecimals: 6,
      amount: '20000000000000000000', // 20 WXDAI
      kind: OrderKind.SELL,
      validFor: 600,
      slippageBps: 50,
    },
    collateralToken: '0xd0Dd6cEF72143E22cCED4867eb0d5F2328715533', // aGnoWXDAI
    flashLoanFeePercent: 0.05,
  },
  tradingSdk
)

console.log('Order created:', result.orderId)
​
orderId
string
Unique identifier for the created order

​
getSwapQuoteParams

Prepare quote parameters for manual quote fetching.
​
params
CollateralSwapParams
required
Same parameters as collateralSwap
const quoteParams = await flashLoanSdk.getSwapQuoteParams(params)
const { quoteResults } = await tradingSdk.getQuote(quoteParams)

console.log('Buy amount:', quoteResults.amountsAndCosts.afterSlippage.buyAmount)

​
getOrderPostingSettings

Generate order settings and get the flash loan adapter instance address.
​
params
CollateralSwapParams
required
Swap parameters
​
quoteParams
TradeParameters
required
Parameters used for quote
​
quoteResults
QuoteResults
required
Results from getQuote
const { swapSettings, instanceAddress } = await flashLoanSdk.getOrderPostingSettings(
  params,
  quoteParams,
  quoteResults
)

console.log('Adapter address:', instanceAddress)

​
getCollateralAllowance

Check the current collateral token allowance for the flash loan adapter.
​
trader
string
required
Trader address
​
collateralToken
string
required
Aave aToken address
​
amount
bigint
required
Required amount
​
instanceAddress
string
required
Flash loan adapter address
const allowance = await flashLoanSdk.getCollateralAllowance({
  trader: ownerAddress,
  collateralToken: '0xd0Dd6cEF72143E22cCED4867eb0d5F2328715533',
  amount: BigInt('20000000000000000000'),
  instanceAddress,
})

console.log('Current allowance:', allowance.toString())

​
approveCollateral

Approve the flash loan adapter to spend collateral tokens.
​
params
CollateralAllowanceParams
required
Same structure as getCollateralAllowance params
if (allowance < requiredAmount) {
  const txResponse = await flashLoanSdk.approveCollateral({
    trader: ownerAddress,
    collateralToken: '0xd0Dd6cEF72143E22cCED4867eb0d5F2328715533',
    amount: BigInt('20000000000000000000'),
    instanceAddress,
  })

  console.log('Approval transaction:', txResponse.hash)
}

​
Complete Examples

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Basic Collateral Swap

import { AaveCollateralSwapSdk } from '@cowprotocol/sdk-flash-loans'
import { TradingSdk, OrderKind, SupportedChainId } from '@cowprotocol/sdk-trading'
import { ViemAdapter } from '@cowprotocol/sdk-viem-adapter'
import { createPublicClient, http, privateKeyToAccount } from 'viem'
import { gnosis } from 'viem/chains'

// Set up adapter
const adapter = new ViemAdapter({
  provider: createPublicClient({
    chain: gnosis,
    transport: http('YOUR_RPC_URL')
  }),
  signer: privateKeyToAccount('YOUR_PRIVATE_KEY' as `0x${string}`)
})

// Initialize Trading SDK
const tradingSdk = new TradingSdk(
  {
    chainId: SupportedChainId.GNOSIS_CHAIN,
    appCode: 'aave-flash-loan-app',
  },
  {},
  adapter
)

// Initialize Flash Loan SDK
const flashLoanSdk = new AaveCollateralSwapSdk()

// Execute swap
const result = await flashLoanSdk.collateralSwap(
  {
    chainId: SupportedChainId.GNOSIS_CHAIN,
    tradeParameters: {
      sellToken: '0xe91D153E0b41518A2Ce8Dd3D7944Fa863463a97d', // WXDAI
      sellTokenDecimals: 18,
      buyToken: '0x2a22f9c3b484c3629090FeED35F17Ff8F88f76F0', // USDC.e
      buyTokenDecimals: 6,
      amount: '20000000000000000000', // 20 WXDAI
      kind: OrderKind.SELL,
      validFor: 600,
      slippageBps: 50,
    },
    collateralToken: '0xd0Dd6cEF72143E22cCED4867eb0d5F2328715533', // aGnoWXDAI
    flashLoanFeePercent: 0.05,
  },
  tradingSdk
)

console.log('Flash loan order created:', result.orderId)

​
Advanced with Manual Approval

const params = {
  chainId: SupportedChainId.GNOSIS_CHAIN,
  tradeParameters: {
    sellToken: '0xe91D153E0b41518A2Ce8Dd3D7944Fa863463a97d',
    sellTokenDecimals: 18,
    buyToken: '0x2a22f9c3b484c3629090FeED35F17Ff8F88f76F0',
    buyTokenDecimals: 6,
    amount: '20000000000000000000',
    kind: OrderKind.SELL,
  },
  collateralToken: '0xd0Dd6cEF72143E22cCED4867eb0d5F2328715533',
  flashLoanFeePercent: 0.05,
}

// Step 1: Get quote parameters
const quoteParams = await flashLoanSdk.getSwapQuoteParams(params)

// Step 2: Get quote
const { quoteResults, postSwapOrderFromQuote } = await tradingSdk.getQuote(quoteParams)

// Step 3: Review quote
const buyAmount = quoteResults.amountsAndCosts.afterSlippage.buyAmount
console.log(`Will receive at least: ${buyAmount} tokens`)

// Step 4: Get order settings
const { swapSettings, instanceAddress } = await flashLoanSdk.getOrderPostingSettings(
  params,
  quoteParams,
  quoteResults
)

// Step 5: Check and approve collateral
const sellAmount = BigInt(params.tradeParameters.amount)
const allowance = await flashLoanSdk.getCollateralAllowance({
  trader: quoteParams.owner,
  collateralToken: params.collateralToken,
  amount: sellAmount,
  instanceAddress,
})

if (allowance < sellAmount) {
  const txResponse = await flashLoanSdk.approveCollateral({
    trader: quoteParams.owner,
    collateralToken: params.collateralToken,
    amount: sellAmount,
    instanceAddress,
  })
  console.log('Approval tx:', txResponse.hash)
}

// Step 6: Post order with manual approval
const result = await flashLoanSdk.collateralSwap(
  {
    ...params,
    settings: {
      preventApproval: true, // Skip auto-approval
    },
  },
  tradingSdk
)

console.log('Order created:', result.orderId)

​
Understanding Collateral Tokens

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What are aTokens?

When you deposit assets into Aave, you receive aTokens (interest-bearing tokens):
  • Accrue interest automatically
  • Can be used for flash loan collateral swaps
  • Examples: aGnoWXDAI, aGnoUSDC

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Common aTokens on Gnosis Chain

const AAVE_TOKENS = {
  aGnoWXDAI: '0xd0Dd6cEF72143E22cCED4867eb0d5F2328715533',
  aGnoUSDC: '0xc6B7AcA6DE8a6044E0e32d0c841a89244A10D284',
}

​
Flash Loan Fees

Aave flash loans charge a fee (typically 0.05%): 
// With 0.05% fee on 20 WXDAI:
// - Flash loan: 20 WXDAI
// - Fee: 0.01 WXDAI
// - Actual swap: 19.99 WXDAI

{
  amount: '20000000000000000000',
  flashLoanFeePercent: 0.05, // 0.05%
}
The fee is automatically deducted before getting the quote to ensure proceeds cover both output and repayment.

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Hook Architecture

The SDK uses CoW Protocol hooks to orchestrate the flash loan:

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Pre-Hook (300,000 gas default)

  • Deploys the Aave adapter contract deterministically
  • Transfers the flash loan to the adapter
  • Sets up swap parameters

​
Post-Hook (600,000 gas default)

  • Executes collateral swap via the adapter
  • Repays Aave flash loan with fees
  • Transfers remaining tokens to owner
Gas limits can be customized per operation or set as SDK defaults.

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Limitations

  • Only supports Aave V3 flash loans
  • Requires sufficient liquidity in Aave pools
  • Flash loan fees apply (typically 0.05%)
  • Subject to CoW Protocol order limits
  • Network-specific contract deployments required

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Security Considerations

Always review quotes before execution and test with small amounts first.
  • Set appropriate slippage tolerances
  • Verify token addresses and decimals
  • Monitor transaction execution
  • Be aware of flash loan fees and costs
  • Ensure sufficient collateral balance
Last modified on March 4, 2026