What is Bitcoin? Since the controversial uncovering of Tor’s Silk Road, many have heard of Bitcoin in relation to the buying and selling of illicit items on the deep web. Having a working knowledge of virtual money is important; it will allow you to entertain new ideas about the influence of the government on economy, the influence startups have on the market, issues of Internet safety and surveillance, and even experiment.

We are increasingly close to a being a cashless society. Last year, 27 percent of all point-of-sale purchases were made with cash, and that number is expected to drop to 23 percent by 2017 according to a report published in June by Javelin Strategy & Research, a market-research firm. One reason why people love using cash is because it is so difficult to track. The future is predicted to be mainly cashless, but that doesn’t mean we should be without an alternative form of economic privacy.

Bitcoin is the first decentralized currency, meaning it is not issued by a government authority. No one controls it, and for this, we can be thankful. It is a peer-to-peer currency with no middle man. Bitcoin is an accepted form of payment worldwide. The value of bitcoins rise and fall like stocks, and based on 24-hour weighted prices, as of Thursday night, one bitcoin was equal to approximately $140.

According to The Guardian, Kreuzberg, Berlin, is the neighborhood with the highest concentration of Bitcoin-friendly businesses in the world. Businesses ranging from record stores to pastry shops accept the virtual currency. One café owner said, “There is not a prototype bitcoin payer. It’s random people. Not only nerds, let me put it that way.” There is no transaction fee to use Bitcoin, so this fact, along with growing fears of economic instability and having money in banks, could be why Bitcoin’s efficiency would be appealing to businesses.

Bitcoin allows users pseudo-anonymity to conceal identity. The same way a PayPal account would be attached to an email, Bitcoin users have Bitcoin addresses where funds are sent. Every Bitcoin address has a private key that allows the user to prove his bitcoins are his own. In order to maintain privacy, it is recommended to change your address or work through an open-source browser.

Users interact with one another using a “wallet.” Wallets work like emails for transactions. Virtual wallets can be downloaded for Apple and Android smartphones and allow you to view your balance and make bitcoin transactions. Wallets are not banks, cannot view your transaction history and do not own the money that passes through them.

A block chain registers every bitcoin transaction. From this register, we can see that nearly 11.6 million bitcoins are in circulation right now. There are only 21 million bitcoins total and this number can never be exceeded. Bitcoins have controlled supply. The only way to access more of the supply is through “mining.”

Bitcoin mining is a term used to define the way more bitcoins enter the market. Miners are simply people who use computer software to create and add to chains of code to the block chain of previous transactions. When they succeed at this, the reward is in bitcoins. Most Bitcoin users are not miners.

Bitcoin may not be the end of the dollar, but it is worth paying attention to economic trends like bitcoins. In this time of privacy crisis, Bitcoin exemplifies people’s innovative spirit under the pressure and cultural change caused by the expansion of the Internet.