Back when cassette tapes where ruling thanks to the possibility they offered to record almost anything (live sounds, radio, vinyl, CD, tapes...), it was the favorite format of teenagers, who would trade or offer personal compilations to their friends and loved ones. To be honest, it was a magical time. The format then gained fame within the hip-hop community as a way for DJ's to spread their mixes. And it opened a glorious era, full of discoveries, sonic gems, and sane competition.
Then the CD arrive, and the same actors switched to this format, which allowed an even faster and wider distribution. Then it became uncontrollable when the mp3 and later the streaming possibilities came into play. That's where we are nowadays.
Many rappers owe their introduction in the game to the mixtape scene. As a DIY way of making and distributing music, for a genre like hip-hop, it's a natural thing.
Mainstream acts like Kanye West, 50 Cent, Drake, Migos, Future, Gucci Mane, Lil Wayne and alternative cats like Earl Sweatshirt, Tyler the Creator, Lil B, Danny Brown, Run The Jewels, Chance The Rapper (who won a Grammy with a mixtape) used the mixtape for several reasons : as a business card cleverly placed on the desk of the music industry executives or as a way around the limits of their respective contracts with labels and majors. Indeed, several rappers kept releasing mixtapes after their break out in the music industry : the examples of Drake and Lil Wayne are famous. Lots of mixtapes even became considered as albums after they gained success and were pressed on physical formats.
Now, if you're looking into a ranking of the best (post-cassette era) mixtapes, Pitchfork made an attempt at listing a few. XXL Mag has the same idea a few months ago. Far from being exhaustive, but a simple way to get into this essential page of the hip-hop story book.
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