UXTO

UTXO stands for "Unspent Transaction Output," the accounting unit that Bitcoin and similar cash-style blockchains use to track spendable value. Instead of storing a single account balance the way a bank does, a UTXO-based network keeps a running set of individual outputs from past transactions that have not yet been spent. A wallet's total balance is simply the sum of every UTXO tied to its addresses, which is why a wallet needs to fully sync with the blockchain before it can display an accurate figure.

Each new transaction consumes one or more existing UTXOs as inputs and creates fresh ones as outputs. Because a UTXO can only be spent in full, sending less than it is worth requires the network to generate a "change" output back to the sender, much like paying with a large banknote and receiving coins in return. Once an output is consumed it is permanently removed from the set, which is how the protocol prevents the same coins from being spent twice without relying on a central ledger keeper.

The complete collection of unspent outputs across a network is called the UTXO set, and every full node maintains its own copy to validate new transactions instantly. This design, used by Bitcoin and forks such as Litecoin and Bitcoin Cash, differs from the account-based model used by Ethereum, where balances live in one mutable state rather than discrete outputs. UTXOs support easier parallel validation and cleaner auditability, since any coin can be traced back through its transaction ID to its origin. Very small, uneconomical outputs are often called "dust."