Unspent Transaction
Outputs
Think of UTXOs as digital banknotes. You can’t tear a €50 note in half, you spend the whole thing, and get change back.
A UTxO is a discrete chunk of value sitting on the blockchain, waiting to be spent. Unlike a bank account with a running balance, your wallet doesn’t hold “150 ada” as a single number. Instead, it holds a collection of UTXOs, maybe a 100 ada output from yesterday and a 50 ada output from last week.
When you make a transaction, you consume one or more UTXOs entirely (they’re “spent” and can never be used again) and the transaction creates new UTXOs: one for the recipient and one as “change” back to yourself.
The key insight: there is no mutable state. UTXOs are created and destroyed, never modified. This makes the system inherently parallelizable and deterministic.
Value conservation: inputs must equal outputs plus fees. No value is created or destroyed, it only moves.
UTXO Transaction Lifecycle
No Double Spending
Each UTxO can only be spent exactly once. The moment it appears as an input in a valid transaction, it’s gone forever. This is Bitcoin’s elegant security model: no race conditions, no balance checks.
UTxO Transaction Graph
Click a transaction node to trace value flow through the chain.
Three quick questions
Optional. Score 3/3 to earn mastery badges. Your first attempt counts for the Polymath badge.
