Account-Based Model

The account-based model is the accounting design used by Ethereum and most smart-contract chains, where the ledger stores a running balance for each address rather than a collection of individual coins. Sending value simply decrements one account and increments another, and a per-account nonce orders transactions and blocks replays. This makes smart contracts natural, since a contract is itself an account with code and persistent storage. The alternative is the UTXO model, where a wallet spends discrete unspent outputs instead of editing balances. Account-based state is compact and easy to reason about, but transactions touching the same account must be processed in sequence, which limits some forms of parallel execution and makes stuck-nonce situations possible.