[Budabellly]

I don't know that it's outright illegal. But manipulating the price of a token for your own gain, at someone else's expense, is illicit imo.

If I know how an oracle calculates a price for a pair, I can probably alter the oracle's value for it (with a lot of volume from your flash loan), without affecting other exchanges value for it. This lets you create arb opportunities for yourself: https://www.trustnodes.com/2020/02/15/hacker-makes-360000-et...

Here's an explanation I just googled for that includes oracle manipulation: https://hackingdistributed.com/2020/03/11/flash-loans/

Again, there are certainly legit applications of flash loans, the market is still learning. This looks like a legit triangle arb: https://medium.com/@kentmakishima/the-43k-defi-magic-trick-f...

I think these exploiters giving some of the money back to their victims testifies to the shadiness of their tactics: https://www.longhash.com/en/news/3407/Why-Do-DeFi's-%22Flash...

Front running is a whole other beast :)