From 15db19a0d21f71693d0b0ecdd3b1ea2b6fa9a5b1 Mon Sep 17 00:00:00 2001 From: jrakibi Date: Thu, 9 Jan 2025 23:59:29 +0530 Subject: [PATCH] add explanation utxo --- decoding/utxo.mdx | 12 +++++------- 1 file changed, 5 insertions(+), 7 deletions(-) diff --git a/decoding/utxo.mdx b/decoding/utxo.mdx index 2ca6244..76ce1ea 100644 --- a/decoding/utxo.mdx +++ b/decoding/utxo.mdx @@ -31,7 +31,7 @@ images: Tracking user balances in decentralized networks relies on two models: 1. **Account Model** (Ethereum): Tracks balances like a bank ledger (simple and intuitive). -2. **UTXO Model** (Bitcoin): Tracks specific unspent outputs from transactions—complex but powerful. +2. **UTXO Model** (Bitcoin): Tracks specific unspent outputs from transactions (complex but powerful) --- @@ -61,13 +61,11 @@ Bob has three "bills" (UTXOs): - One 3 BTC UTXO - One 2 BTC UTXO -To spend 7 BTC, Bob must: +To spend 7 BTC, Bob has multiple options: -1. Use the 5 BTC UTXO -2. Use the 3 BTC UTXO -3. Get 1 BTC back as "change" (new UTXO) - -Key Points: +1. Use the 5 BTC and 3 BTC UTXOs and receive 1 BTC back as 'change' (a new UTXO). +2. Alternatively, use the 5 BTC and 2 BTC UTXOs without needing any change. + Key Points: - UTXOs can only be spent once (like using a paper bill) - Each transaction creates new UTXOs