Part 3/8:
Smart contracts, a fundamental component of blockchain technology, enable the automated execution of specific actions based on predetermined conditions. By using smart contracts to conduct trades in real-time on decentralized exchanges, traders can effectively mitigate the risk associated with price fluctuations—ensuring that a purchase and sale occur simultaneously without interference.
Gregory stresses that while transaction fees could still incur loss if trades do not go through as planned, the risk of losing money is minimized by employing flash loans, a critical component in this strategy.