🪙 How To Handle Bitcoin UTXO's

Author

Hector Alvero
July 09, 2024

Welcome to the Rhino Roundup, your weekly dose of industry news, platform updates, educational content, and fun memes in the world of Bitcoin.

Rhino Feature Spotlight 📢

With Rhino Bitcoin, sending cash around the world to family and friends has never been easier.

You can send cash internationally through the app, and the recipient will receive it as local currency.

Rhino uses the Bitcoin Lightning Network as rails for these transfers, without requiring you or the recipient to own Bitcoin.

Featured Article

What are UTXOs?

Think of UTXOs as digital receipts for Bitcoin transactions. Each transaction on the Bitcoin network generates outputs. For example:

Initial State (Person A's Wallet):

Before the transaction: Person A has one UTXO containing 0.05 BTC and wants to send 0.04 BTC to Person B.

After the transaction:

  • The original UTXO 1 is destroyed.

  • Two new UTXOs are generated:

    • Person B receives a new UTXO 2 containing the sent amount (0.04 BTC).

    • Person A receives a new UTXO 3 with the remaining balance (0.01 BTC).

How to Manage Your UTXOs More Efficiently

UTXO Consolidation

UTXO consolidation involves combining smaller UTXOs into larger ones. This practice can reduce transaction fees and make subsequent transactions simpler. Managing UTXOs efficiently is an essential factor in optimizing one’s bitcoin balance. It is crucial to have UTXOs that are neither too small nor too large.

Want more details on how to safely consolidate your UTXO’s? Read the full post here to find out more.

Meet the Team

Our COO, Hector Alvero, recently co-hosted a Space on X with Tracy Elliot featuring the renowned Daniel Sempere Pico aka @BTCGandalf.

Their conversation covered Daniel’s journey to becoming a top Bitcoin content creator and discussed the two upcoming books he is currently writing.

You can listen to the Space here.

Meme of the Week