A distributed Digital currency backed by processing power was a fairly old idea at the time. The first time I heard about the idea was late 90's but I think it's earlier than that.
This is not exactly correct. Nobody had proposed a system that was as distributed as bitcoin until bitcoin came on the scene. Szabo wanted to use lots of timestamp servers and Finney wanted to rely on "transparent servers" that borrowed ideas from Trusted Computing so they could be audited.
To have a currency backed by processing power is not really an old idea either. It was at most 10 years old and nobody really had a good idea how proof-of-work (POW) could make a currency at that time (around 1999). I'm referring to the "Bread Pudding" variant of MicroMint (http://www.hashcash.org/papers/bread-pudding.pdf), not Cryptonomicon which doesn't really mention distributed computing or POW.
The blockchain is just a hash tree, which was patented by Ralph Merkle in 1979. Using blocks of financial transactions as nodes is a new application, but not so different to the idea of propagating rights down the certificate chain you find in PKI.
The blockchain is not just a hash tree. There's other features that mesh together in the blockchain. For example a proof-of-work system that allows bitcoin to be distributed and trust-less by preventing Sybil attacks. While using rewards for this work as the sole means of money creation was anticipated by others, the automatic means of adjusting the cost function is a Satoshi original and very important to the success of bitcoin.
How else do you propose to create a distributed concurrency?
The traditional approach would be a public ledger mantained by the 'miners' aka a block-chain. The the issue is that's not anonymous, but while a lot research went into creating an anonymous currency bitcoin was a MVP which took off. Now, I am not saying nothing about bitcoin was new, just the innovation was in the specific implementation not the overall idea.
Bit torrent was released in July 2001, bitcoin 2009 so the idea of distributed networks was fairly well established at the time.
PS: And yes, there was a lot of early criticism about the public nature of bitcoin.
There really was no "traditional approach" to creating a distributed digital currency at the time. The blockchain is a product of Satoshi's thought and is the central innovation in bitcoin. The principal issue was not anonymity but making a network that didn't require third parties to prevent double-spending. Genuine technical problems that a lot of smart people hadn't been able to solve were solved by bitcoin.
Bittorrent was way easier because it was about copying, whereas a currency has to in a sense make copying impossible via some sort of time-stamping to prevent double-spend.
> How else do you propose to create a distributed concurrency?
That's the point: No one knew how to do that before Satoshi.
> The traditional approach would be a public ledger mantained by the 'miners' aka a block-chain.
Are you joking? If you knew about the blockchain and miners before 2008, you could have simply created Bitcoin yourself and become multimillionaire.
> The the issue is that's not anonymous, but while a lot research went into creating an anonymous currency bitcoin was a MVP which took off.
The issue was no one knew how to create a trustless consensus mechanism. And Bitcoin is not anonymous, it's pseudonymous. True anonymity only became possible after Bytecoin's innovation in the use of ring signatures. Nowadays the most popular coin with true anonymity is Monero (created in 2014, as a fork of Bytecoin with a fair distribution).
> the innovation was in the specific implementation not the overall idea
Clearly you don't know what you are talking about.
> Bit torrent
What does that have to do with anything? Bittorrent doesn't use a blockchain.
EX: http://en.wikipedia.org/wiki/Cryptonomicon