# Core Architecture

For privacy reasons, Veilnyx adopts UTXO-based architecture (like in Bitcoin and ZCash) unlike Ethereum's simple account-based architecture. The transactions in this architecture approximately simulate the spending of physical cash notes in a peer-to-peer transaction. The UTXO (UnSpent Transaction Output) can be considered as a digital **Note**. The bearer of the note has the authority to spend the note in a transaction and optionally may receive any change/leftover funds.

More details ahead.
