UTXO (unspent transaction output) is the method of Electra Protocol for record-keeping the number of coins someone has remaining after executing a transaction on the blockchain. The UTXO model is a key method in which blockchain architecture maintains an accurate ledger while ensuring privacy.
UTXO model blockchains execute transactions by using UTXOs generated by previous transactions as an input, then receive UTXOs generated by the new transaction as an output. In a transaction, UTXOs are always consumed in full, even if the required payment is of the partial value of the original UTXO. The collection of all the UTXOs at any moment is called the UTXO set. Every UTXO is associated with an Electra Protocol address.
