UTXO (Unspent Transaction Output) transaction is a blockchain accounting model that tracks ownership of tokens by recording and updating individual outputs from past transactions. It works similarly to cash: you use whole coins (UTXOs) to pay and get change back.

UTXO transaction contains:

• Inputs: References to previous transaction outputs (transaction ID + output index).
• Outputs: New UTXOs with amounts and recipient addresses.
• Signatures: Cryptographic proofs authorizing the spending of inputs.

The flow of UXTO transaction includes the following:

1. Consumes one or more inputs (UTXOs you already have).
2. Creates one or more outputs (new UTXOs, some for the recipient, some as change to yourself). Each output is immutable and indivisible—you must spend the whole thing or not at all.

UTXO transactions and Travel Rule

Travel Rule is designed to ensure transparency in virtual transfers by identifying and screening both the originator and beneficiary of a transaction. However, in the case of UTXO transactions, which can involve multiple input and output wallet addresses within a single transaction, it becomes critical to accurately determine which addresses are relevant for Travel Rule compliance.

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Note

Sumsub supports UTXO transactions conducted using only the following cryptocurrency networks: Bitcoin (BTC), Bitcoin Cash (BCH), and Litecoin (LTC).

For UTXO-based blockchains, Sumsub applies a set of configurable Travel Rule behaviors that allow relevant wallet addresses to be identified, extracted, and reviewed using on-chain data. For details on how to enable and manage these options, see this article.

Depending on the configuration, Sumsub may:

• Extract transaction inputs and outputs directly from the blockchain for after on-chain UTXO Travel Rule transactions where a transaction hash is provided.
• Display all detected input and output wallet addresses in the transaction review interface.
• Infer the transaction originator for after on-chain UTXO Travel Rule transactions where the originator wallet address is not explicitly provided, by applying heuristics (for example, selecting the largest input as the presumed sender).

Sumsub uses these mechanisms to support Travel Rule compliance for UTXO-based networks and operate on a best-effort basis, particularly in cases where complete transaction data is not available at submission time.