UTXO or Unspent Transaction Output, is the transaction model that bitcoin uses.
Account based transaction model has been popularized by Ethereum.
Comparison
The UTXO model can be seen as potentially more scalable and secure due to being deterministic but the account model is easier to work with and more lightweight.
In transactions, UTXO allows for multiple transactions to occur
When it comes to smart contracts, the account model allows only the state to be updated where in the UTXO model, the whole script needs to be recreated and included in one of the outputs. Because of this the account model allows for multiple people to interact with a contract at once.
Account-Based Blockchains
A type of Blockchain (e.g. Ethereum), where transactions can be made up of many sub-executions, each potentially with different assets each with their own inputs and outputs.
In Account-Based blockchains, wallets are modeled after Bank Accounts. Your Balance is stored as a single number associated with your account. Each transfer makes changes to your account. Which is a key feature that allows smart contracts to work.
💡 In Ethereum, a sub-execution is often called a “transfer”, but within this collection, a transfer is not an ethereum sub-execution.
UTXO Blockchains
A type of Blockchain (e.g. Bitcoin), where transactions only have inputs (existing UTXOs) and outputs (new UTXOs).
When you make a transaction, your existing UTXOs are consumed and new UTXOs are created and assigned to the wallet address.
Your Balance is the sum of all your unspent UTXOs.