Bitcoin and chains · 14 / 127 · 2 min
A UTXO
Bitcoin does not store a balance on your address. It stores coins that have not been spent. A payment spends one of those coins whole.
The wallet's balance is a sum. The chain stores the receipts.
A worked case
A wallet shows one number. The payment spends a whole receipt and makes a new one for the leftover. The person who only watched the balance thinks the second output is a stranger.
The coin
An unspent transaction output is a receipt from an earlier payment that nobody has spent. A wallet adds those receipts up and shows a balance. The chain does not store that sum.
Spending it
You cannot peel a corner off a receipt. The whole output is spent, and any leftover becomes a new output. That leftover is the change, usually to an address the wallet controls.
The balance is a sum the wallet made
Bitcoin's record is a list of outputs that have not been spent. An address can have several. The number in the app is the wallet adding them. The chain never wrote that total down.
A payment smaller than the coin you spend creates a second output. The chain does not mark it as yours. The wallet does, if it made the address. That is why change is the next thing to read.
Read it yourself
These links are the record. They are not a recommendation, and they are not instructions. A news story or a court paper can still be wrong about a detail. The check does not change because a famous name is in the story.
Apply the check
Open a question. The line is about this topic. It is not a verdict that anything is safe.
The addresses named in the outputs you signed.
You, by which receipts you spend. The wallet, by the change address it builds.
The signature. An output that is spent is gone.
Check yourself
Write it in your own words. The course's answer opens after that. Nothing is sent.
After this you can name the output you are spending, and the output that comes back as change.