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Homework on UTXO’s vs Account Model:
1.- The lesser the information a transaction has, the more transactions per block can be performed.
2.- With the UTXO model when you perform a transaction, the change is sent either to a new address or back to your wallet using a “change address” so it was harder to know the exact amount sent and to who. With the account model, you are moving exact amounts of coins to specific addresses or contracts. Also on Ether Scan you can see how many coins and tokens you have stored, so everything is more transparent.
The account model doesn’t require much space as the UTXO model, why is that a benefit?
It’s a benefit because each transaction uses less space, taking less time to process enabling
lower fees.
How is the account model not as great as the UTXO model for privacy?
UTXO’s can have multiple outputs at the same time, making it hard to track, whereas the account
model has one input and one output address for every transaction making it a Fungible system.
Less Data space on each tx translates to more tx that can fit in a single block resulting in a cheaper and faster tx. As to the single node the full block chain is lighter and requires less hardware to maintain.
A UTXO model works on a calculation of inputs and outputs, reaching out to the recorded data each time will call up all different UTXO belonging to a specific private key, resulting in a very low option for traceability, meaning more privacy.
The account model is based on a balance for each user and value is stored there directly, the tx will deduct that value from one account and add it to a different account.
that been said all data is stored on the block chain leaving a high level of traceability - less privacy.
The ETH account model doesn’t require as much space as the BTC UTXO model. This reduces the memory required to store the transactions so the network can run faster and have lower transaction fees for users.
The ETH account model is not as good for privacy as the transactions are simply from sender A to receiver B. Pretty simple to follow, even though the sender could own the receiver address. In BTC you can have several outputs, and you could own several of them making it much harder to follow where the transactions are coming from and going to. The ETH model makes the system more fungible as an individual ETH has no past history, whereas a BTC UTXO can be traced back to its origin perhaps through several shady or illegal deals.
The smaller space required by the account model is beneficial because all transactions take up less room in the block. This will result in lower fees.
The account model is not as private as UTXO’s because there is simply the record of a transaction of funds where the amount is known, as well as the addresses of the sender/recipient.
Due to not having to track UTXOs less space is taken. This means you can fit more transactions per block, which is helpful for scalability. It is also more efficient resulting in faster, less expensive transactions.
It’s built on the model of 1 ETH = 1 ETH. Every transaction is just a transfer from one account to another. Once you knew an address you could follow the money. With UTXO however, transactions are combined and can include sending funds back to yourself making it very difficult to discern who the transactions belong to.
Ansers:
The account model is more beneficial than the UTXO model is the sense that it doesn’t contain UTXO inputs and outputs. This prove to be higher and faster efficiency when it comes to mining Ethereum blockchain which in turn could generate faster transaction at a lower fees rate,
The account model doesn’t allow a person to send money back to themselves which is not good for privacy unlike a bitcoin UTXO transaction where you can send money to others and also back to yourself which from outside you can’t tell which is which.
The account model doesn’t require much space as the UTXO model, why is that a benefit?
Saving space in a Block allows to integrate more transactions. In the case of the Ehterium Blockchain the space saved allows to integrate more transactions and / or more Smart Contracts.
How is the account model not as great as the UTXO model for privacy?
In the account model we know exactly which Etherium Address “A” sends what to another Etherium Address “B”. Whereas in the UTXO model there is no balance of coins like in the Etherium Blockchain, instead there are different UTXOs available and those UTXOs can be sent to different Bitcoin Addresses in the same transaction.
The account model doesn’t require much space as the UTXO model, why is that a benefit?
Takes up less space per transaction more transactions per block.
How is the account model not as great as the UTXO model for privacy?
It is less private because you can easily track TX’s (1 input = 1 output)
1- I would assume that if a transaction doesn’t take up as much space, it can go through faster. It also leaves more room for the information of the smart contract code and smart contract states on ETH.
2- With the account model, you can trace exactly where each transaction is going. There is an EXACT address for each transaction. There’s only one Tx instead of a bunch of inputs and outputs, so it’s very clear where the money is going. Whereas, in BTC, since there are many inputs and outputs possible, the outside world CAN’T tell exactly where the transaction amount as a whole is going- is it to a recipient or back to my address!
The account model doesn’t require much space as the UTXO model, why is that a benefit?
It takes less space on the blockchain
Simpler with less code so faster to process
How is the account model not as great as the UTXO model for privacy?
Cannot send money back to myself like BTC that can have multiple output.
When someone is looking at the Ethereum blockchain, they can see exactly how much I have received from X and sent to X because Ethereum transactions just update accounts balances
The fact that the account model does not require as much space as the UTXO model is beneficial because the sheer volume of inputs and outputs would clog up the network - and slow down the execution of any complex processes programmed into smart contracts and propagated across the network. The added complexity is necessitated because the Ethereum blockchain stores not only transactions but also the code for every smart contract and the state of each smart contract. Therefore having an on chain UTXO model would cause further scalability issues.
The account model does not have the same degree of privacy as the UTXO model because when a transaction moves from A to B there are no multiple inputs and output. Therefore when a single transaction is sent you cannot send it a part of it back to yourself - which is possible instead with UTXOs because if they are not spent in full, they will return “change“ to the sender (I.e. the difference between what value was transferred + fee, and the total size of the UTXO(s) that was sent. You could of course send an Ethereum transaction to another wallet you control but this is not the same.
Correct, but what about improvements to the network? Can you name some advantages?
Amazing answers as always Alex!! Keep up the great work!
Could be a benefit because transactions are faster and also alow you to account easily with a balance system.
Because you cannot send many transactions to different accounts, so you lose the benefit of sending also money back to yourself. This make’s it less private
Because since the account model only keeps track of the balance update, it has a much lighter data structure than bitcoin’s UTXO model; thus, fitting more TXs per Byte in a block. They are also faster TXs, in comparison.
Unlike the UTXO model that allows you to solve the problem of ‘change back’ by sending funds to others (or not) and back to yourself (different address) in the same TX, making it more difficult to find who the true recipients are; The account model allows you to send the exact amount but not to more than one recipient in the same TX, making it easier to find the recipient; so, less private.
The account model doesn’t require as much space as the UTXO model, why is that a benefit?
Well, I don’t recall that it was stated in the video, but I can imagine that requiring less space would be beneficial for using up less of the block space, making transactions faster. However it was mentioned that the account model makes it more fungible since 1 ETH is equal to all other ETH in value by not carrying a shady transaction history.
How is the account model not as great as the UTXO model for privacy?
The account model is considered to have less privacy because it doesn’t allow for multiple UTXOs which somewhat conceal precisely how much will be received by the recipients, allowing for senders to send BTC back to themselves. Anyone looking at the transaction can see exactly how much was sent, and to which address.