Can you explain the role of the UTXO model in the transaction process of cryptocurrencies?

1 answers

• Torres HalseyJun 29, 2023 · 3 years ago
  In the transaction process of cryptocurrencies, the UTXO model acts as a ledger that keeps track of the available funds. It works by recording the output of every transaction as a UTXO, which can then be used as an input for future transactions. When a new transaction is created, it references the UTXOs it wants to spend and creates new UTXOs as outputs. This model ensures that each transaction is valid and that the same UTXO cannot be spent twice. It also allows for easy verification of transactions and provides a transparent record of all transactions. Overall, the UTXO model is essential for maintaining the integrity and security of the transaction process in cryptocurrencies.
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