Unspent transactionA transaction is a record of an event that occurred in the past. Transactions typically occur during the course of... Read More output (UTXO) is a data structure for the amount of cryptocurrencyCryptocurrency is decentralized digital currency secured by cryptography. Cryptocurrency utilizes cryptographic protocols to record ownership and prevent counterfeits (when ownership... Read More a user can spend and is used to track cryptocurrency balances. It is a fundamental element of BitcoinBitcoin is a cryptocurrency. It operates without the need for a central authority like a central bank or a company,... Read More and many other cryptocurrencies as it defines where each blockchain transactionA blockchain transaction is a digital recording of an event or action stored in a public, decentralized ledger. A blockchain... Read More starts and finishes. Cryptocurrency transactions are inputs and outputs. In the UTXO model, each user has a UTXO associated with their public keyA public key is a cryptographic key used to encrypt data. Any party can use a public key to encrypt... Read More. When a transaction occurs, one or more of a user’s UTXOs serves as the input. The user then provides their digital signatureA digital signature is a cryptographic mechanism designed to provide proof of authority and authenticity in electronic form. In blockchain... Read More to confirm ownershipEvery transaction and block on a blockchain has an owner. An owner is any entity (person, group, or organization) with... Read More over those inputs, resulting in outputs. The UTXOs consumed are “spent” and no longer usable. Meanwhile, the outputs from the transaction become new UTXOs, which can be spent in a new transaction later.
