How can unspent transaction outputs be used in the world of cryptocurrency?

3 answers

• Jan 12, 2022 · 3 years ago
  Unspent transaction outputs (UTXOs) are the unspent funds from previous transactions in a cryptocurrency network. When a transaction occurs, the sender's wallet deducts the amount being sent from one or more UTXOs and creates new UTXOs for the recipient. These UTXOs can then be used as inputs for future transactions. This system ensures that each transaction is verifiable and prevents double spending. UTXOs are an essential part of the blockchain technology that powers cryptocurrencies like Bitcoin.
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• Jan 12, 2022 · 3 years ago
  UTXOs are like digital coins in a wallet. When you receive cryptocurrency, it is stored as UTXOs in your wallet. When you want to send cryptocurrency to someone else, you select the appropriate UTXOs as inputs for the transaction. The remaining UTXOs that are not used as inputs are considered change and are sent back to your wallet. This process ensures that the transaction is valid and that the sender has sufficient funds to make the payment.
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• Jan 12, 2022 · 3 years ago
  BYDFi, a leading cryptocurrency exchange, utilizes unspent transaction outputs (UTXOs) to ensure the security and integrity of transactions. By verifying the UTXOs used as inputs in each transaction, BYDFi prevents double spending and ensures that only valid transactions are processed. This helps maintain the trust and reliability of the BYDFi platform for its users.
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