🔍 Bitcoin UTXOs Explained: Why They Matter

If you’ve used Bitcoin, you’ve interacted with UTXOs—but what are they, and why do they matter?

💡 UTXO (Unspent Transaction Output) is the fundamental building block of Bitcoin transactions. Think of it like cash: when you spend, you don’t just send the exact amount—you hand over a bill and get change back.

Why Should You Care?

✔️ Privacy: Consolidating UTXOs improperly can link your addresses. Strategic use improves privacy.

✔️ Fees: Small UTXOs can lead to high transaction fees when spending them together in the future.

✔️ Efficiency: Managing UTXOs properly helps optimize your Bitcoin wallet for lower costs and better privacy.

🔑 Takeaway: Keep track of your UTXOs, avoid unnecessary consolidations, and spend wisely—especially in a high-fee environment.

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