Cryptocurrencies are the digital or virtual currencies working on the cryptographic principles. Yet provides high security and usability than many existing currencies.
Cryptocurrency works on blockchain technology, we have already seen how blockchain works. Every individual in a particular blockchain will have a unique account Id/address. The cryptocurrency is always associated with this accounts (Currency is Debited and Credited to this account).
The encryption mechanism, peer to peer network, and no central authority/central server to control. Each cryptocurrency will be working on a blockchain protocol.
One of the most famous cryptocurrency is bitcoin which relies on the bitcoin blockchain. And ether is another fast-growing cryptocurrency which runs on Ethereum protocol. While comparing with the traditional currencies, the cryptocurrencies provide highly anonymous nature for participants. The only visible identity of a user will be his account ID, rest everything will be encrypted. The participants will not have any idea about the real identity of a user.