<p>There is a nice blog post bu IOG: <a href="https://iohk.io/en/blog/posts/2021/03/11/cardanos-extended-utxo-accounting-model/" rel="noreferrer">Cardano’s Extended UTXO accounting model – built to support multi-assets and smart contracts</a> that discusses the difference between two models.</p>
<p>For a more in depth comparison, I recommend the <a href="https://ipfs.blockfrost.dev/ipfs/QmRkw1hRfdqPdZMpShDY9oEQQLeAywiY4ZaV9DC7qdDpdh" rel="noreferrer">UTxO- vs account-based smart contract blockchain programming paradigms</a> paper.</p>
<p>To sum UTXO up:</p>
<ul>
<li>A UTXO is the output of a previous transaction, which can be spent in
the future</li>
<li>UTXO chains have no accounts. Instead, coins are stored as
a list of UTXOs, and transactions are created by consuming existing
UTXOs and producing new ones in their place</li>
<li>Balance is the sum of
UTXOs controlled by a given address</li>
<li>UTXOs resemble cash in that they
use ‘change’, and are indivisible (UTXOs are used whole)</li>
</ul>
<p>To sum up the Account/Balance model:</p>
<ul>
<li>This accounting model resembles how a bank operates</li>
<li>Users have accounts that hold their coin balance</li>
<li>It is possible to spent partial balances</li>
<li>The concept of change does not apply</li>
</ul>

CC BY-SA 4.0
2021-05-26T19:04:03.043Z
Link only answers are often subject to rot into dead links with time. Maybe you could edit to briefly list the most important points according to you.
Stephane Rolland
CC BY-SA 4.0
2021-05-27T05:29:33.143Z
I hope a scientific paper will not rot in time :) but I moved the points to the answer.
Marek Mahut - StakeNuts
CC BY-SA 4.0
2021-05-27T08:07:03.900Z
It already happened with scientific parpers: publisher reorganizing the structure of publishing site. Then link to papers were falling in the void of a 404 error.
Stephane Rolland
CC BY-SA 4.0
2021-05-27T08:31:47.290Z
Oh, I hope arXiv never disappears, but you are right - I uploaded the paper to IPFS :) and moved the main points to the post.
Marek Mahut - StakeNuts
CC BY-SA 4.0
2021-05-27T16:09:59.470Z
Something I'd note about the EUTxO model is that state machines for smart contracts and state channels can be embedded in the UTxO themselves. This significantly changes the way a smart contract model would operate on the network. From my understanding, while with balance based smart contracts you can have two smart contracts interact with each other, that isn't possible with EUTxO smart contracts. Instead with EUTxO you would compose the smart contracts together and they'd operate as one unified contract for 1 Tx instead.
OneDeuxTriSeiGo
CC BY-SA 4.0
2021-05-26T12:39:36.080Z
2021-05-27T08:31:13.277Z
2021-05-27T08:31:13.277Z
Marek Mahut - StakeNuts
<p>I am sure there is a lot of documentation around it. But just to scratch the surface:</p>
<ol>
<li>Both are not same at all.</li>
<li>ETH fees is charged even for failed transactions. But in eUTXO, your fees is collected only if your transaction succeeds. This alone is huge.</li>
<li>Smart contracts developed in eUTXO model are much more dependable, reliable than the account model.</li>
<li>I am sure you already know that ETH only went with account model because they could not think of a way to make smart contracts work with the Bitcoin's UTXO model.</li>
</ol>
<p>But it is a really interesting comparing both Account and UTXO. Links are there above in some other comments.</p>

CC BY-SA 4.0
2022-11-09T22:59:14.270Z
this is indeed a great answer! tks!
Leonard Neon
CC BY-SA 4.0
2021-05-26T17:00:59.610Z
2021-05-26T17:00:59.610Z
CardanoSaint
<p>The EUTXO model also makes it much easier to scale. Charles talks about that in this <a href="https://youtu.be/eHus4eqPID4" rel="nofollow noreferrer">great video</a> -- the take-away here is that Cardano will be much easier to scale than Ethereum.</p>

CC BY-SA 4.0
2021-05-26T13:29:34.803Z
2021-05-26T13:29:34.803Z
kavu
<p>What are the benefits of Cardano's eUTXO transaction model compared to Ethereum's account-based transaction model? Are there any significant differences?</p>

<ada><eutxo><ethereum>
eUTXO transaction model Vs Account Based Transaction Model
# eUTXO transaction model Vs Account Based Transaction Model

(Asked by: username_0 on 2021-05-26)

What are the benefits of Cardano's eUTXO transaction model compared to Ethereum's account-based transaction model? Are there any significant differences?

**Tags:** ada, eutxo, ethereum

---

## 3 answers

### Answer by username_1 on 2021-05-26. Score: 14

There is a nice blog post bu IOG: [Cardano’s Extended UTXO accounting model – built to support multi-assets and smart contracts](https://iohk.io/en/blog/posts/2021/03/11/cardanos-extended-utxo-accounting-model/) that discusses the difference between two models.

For a more in depth comparison, I recommend the [UTxO- vs account-based smart contract blockchain programming paradigms](https://ipfs.blockfrost.dev/ipfs/QmRkw1hRfdqPdZMpShDY9oEQQLeAywiY4ZaV9DC7qdDpdh) paper.

To sum UTXO up:

* A UTXO is the output of a previous transaction, which can be spent in
  the future
* UTXO chains have no accounts. Instead, coins are stored as
  a list of UTXOs, and transactions are created by consuming existing
  UTXOs and producing new ones in their place
* Balance is the sum of
  UTXOs controlled by a given address
* UTXOs resemble cash in that they
  use ‘change’, and are indivisible (UTXOs are used whole)

To sum up the Account/Balance model:

* This accounting model resembles how a bank operates
* Users have accounts that hold their coin balance
* It is possible to spent partial balances
* The concept of change does not apply

> **Comments:**
> **username_2**: Link only answers are often subject to rot into dead links with time. Maybe you could edit to briefly list the most important points according to you.  
> **username_1**: I hope a scientific paper will not rot in time :) but I moved the points to the answer.  
> **username_2**: It already happened with scientific parpers: publisher reorganizing the structure of publishing site. Then link to papers were falling in the void of a 404 error.  
> **username_1**: Oh, I hope arXiv never disappears, but you are right - I uploaded the paper to IPFS :) and moved the main points to the post.  
> **username_3**: Something I'd note about the EUTxO model is that state machines for smart contracts and state channels can be embedded in the UTxO themselves. This significantly changes the way a smart contract model would operate on the network. From my understanding, while with balance based smart contracts you can have two smart contracts interact with each other, that isn't possible with EUTxO smart contracts. Instead with EUTxO you would compose the smart contracts together and they'd operate as one unified contract for 1 Tx instead.  

---

### Answer by username_4 on 2021-05-26. Score: 4

I am sure there is a lot of documentation around it. But just to scratch the surface:

1. Both are not same at all.
2. ETH fees is charged even for failed transactions. But in eUTXO, your fees is collected only if your transaction succeeds. This alone is huge.
3. Smart contracts developed in eUTXO model are much more dependable, reliable than the account model.
4. I am sure you already know that ETH only went with account model because they could not think of a way to make smart contracts work with the Bitcoin's UTXO model.

But it is a really interesting comparing both Account and UTXO. Links are there above in some other comments.

> **Comments:**
> **username_5**: this is indeed a great answer! tks!  

---

### Answer by username_6 on 2021-05-26. Score: 4

The EUTXO model also makes it much easier to scale. Charles talks about that in this [great video](https://youtu.be/eHus4eqPID4) -- the take-away here is that Cardano will be much easier to scale than Ethereum.


---

