GlossaryAdvanced
UTXO
An unspent transaction output — a discrete chunk of cryptocurrency ready to be spent.
UTXO stands for "unspent transaction output." In UTXO-based systems, a wallet's balance isn't a single number in an account; it's the sum of individual, discrete outputs from past transactions that haven't been spent yet.
When someone sends a transaction, it consumes one or more existing UTXOs as inputs and creates new UTXOs as outputs, some of which go to the recipient and some of which may return as change.
Examples
- Bitcoin uses a UTXO model, while many other networks use an account-based model instead.
- Spending a large UTXO to pay a small amount typically generates a change output back to the sender.