what is the utxo model 
an unspent transaction output utxo is the amount of digital currency that remains after a cryptocurrency transaction you can think of it as the change you receive after buying an item but it is not a lower denomination of the currency it is a transaction output in the database generated by the network to allow for non exact change transactions understanding the utxo modelutxo is a protocol for distributing the bits of data that cryptocurrency is made from and can be difficult to understand initially a cryptocurrency network or developer sees utxo much differently than a day to day cryptocurrency user does for example imagine that 1 btc is a bucket full of coins each coin represents a utxo if you purchase something from bob for 5 btc the network will give bob the entire bucket of coins and send back the 5 btc you re owed in change you now have a utxo worth 5 btc that cannot be divided into smaller amounts nearly all transactions create utxos because the network must gather a user s unspent outputs and send them to the recipient thus it s rare for a user to have the exact amount of utxo needed this is similar to looking under the car seat for loose change to pay for the burger at the drive through and finding a quarter when you only needed a dime the restaurant must give you back 15 utxos are not cryptocurrency denominations like satoshi for bitcoin btc or gwei for ether eth however utxos can be measured in these denominations 