What is UTXO (Unspent Transaction Output)?

In the Bitcoin protocol, UTXO stands for Unspent Transaction Output. It is the basic building block of the Bitcoin blockchain and is used to record a certain amount of Bitcoin ownership. When a new transaction is created on the Bitcoin network, it includes one or more inputs, which are references to UTXOs that the sender uses to provide the funds for the transaction. The transaction also includes one or more outputs, which specify the new ownership of the funds being…