Anonymity in cryptocurrencies allows you to send and receive digital assets without having to give up your real identity to the party on the other end of the transaction, whether you’re the sender or receiver of funds.

When you open a traditional bank account, you’re required by the bank to submit identity verification information like your name, social security number, address, and possibly a government-issued ID.

Outside of centralized crypto exchanges (CEX) which have the same type of Know Your Customer (KYC) identity requirements and identity verification as banks, you could send a crypto payment to another person without ever having to share any of that information with that person or crypto service you’re using to make the payment.

Only the two parties involved in a transaction might know who is on the other end of a transaction.

Your identity stays hidden, you stay anonymous, and the digital assets are sent to anyone with a wallet address, anywhere in the world, without a middle man to question what you’re sending, how much you’re sending, to whom you’re sending it and why.

While your identity does stay hidden, not everything about the transaction is anonymous and hidden.

Due to the public and permanent nature of most blockchains, the transaction itself is stored online, “in the cloud”, on the blockchain, forever, for anyone to see.

Transactions details are visible, such as sender and receiver addresses, what was sent, how much, at what time, how much it cost in fees, and how long the transaction took to verify, but the identities of the address owners are hidden.

Every transaction a wallet address makes is visible to the public.

This level of transparency is what makes most cryptocurrencies pseudonymous as opposed to completely anonymous.

The anonymous nature of cryptocurrencies, while not perfect, was still one of the early use-cases for early adopters on the Dark Web.