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

3 Answers 3


There is a nice blog post bu IOG: Cardano’s Extended UTXO accounting model – built to support multi-assets and smart contracts 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 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
  • 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. Commented May 26, 2021 at 19:04
  • I hope a scientific paper will not rot in time :) but I moved the points to the answer. Commented May 27, 2021 at 5:29
  • 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. Commented May 27, 2021 at 8:07
  • Oh, I hope arXiv never disappears, but you are right - I uploaded the paper to IPFS :) and moved the main points to the post. Commented May 27, 2021 at 8:31
  • 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. Commented May 27, 2021 at 16:09

The EUTXO model also makes it much easier to scale. Charles talks about that in this great video -- the take-away here is that Cardano will be much easier to scale than Ethereum.


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.

  • this is indeed a great answer! tks! Commented Nov 9, 2022 at 22:59

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