Protocols for transferring value, monetary or otherwise, electronically. Cryptocurrencies usually refer to systems that are anonymous. Such systems can be used to implement any quantity that is conserved, such as tokens, collectibles, assets, etc.
Their untraceability has made them attractive for illegal markets and money laundering, which was the reason these were their early adopters. Debates abound about the legality of alternative cash system to national currencies, as well as regulatory concerns over its anonymity aspects, the usefulness for evading taxes, and reporting requirements.
Privacy in an open society requires anonymous transaction systems. Until now, cash has been the primary such system. An anonymous transaction system is not a secret transaction system. An anonymous system empowers individuals to reveal their identity when desired and only when desired; this is the essence of privacy.
Although the cryptographical “digital cash” protocol was attempted in the past, such as in the work of David Chaum and projects such as B-money and Bitgold. It was with Bitcoin’s 2008 white paper and its implementation in the Bitcoin Core client that the concept took hold in the public imagination, which reverberated into unprecedented interest both from enthusiasts and speculators. Its speculative bubble in late-2017 was the largest in history, to the time of this writing.
The success of the cryptocurrency brought into public debate the very nature of money, the decoupling of government from currency, crypto-anarchy, libertarianism, Austrian economic principles, and the 2008’s economic crisis and its ensuing bank bailouts.