This seems a great way to steal other people's credit cards. You can literally duplicate someone's card on your "coin".
Now there's a super easy way for someone working in a restaurant to get your credit card information and sell it.
Now there's a super easy way for someone working in a restaurant to get your credit card information and sell it.
1) This can already be done using a simple stripe reader.
2) Coin can identify, investigate and proactively block anyone who has more than the average number of cards, so Coin actually seems well positioned to reduce fraud. Also, Coin could identify that multiple Coin cards have the same credit/whatever cards on them and, the next day, prompt you to swipe your card again to confirm. [Provided that Coin uploads suitable data to its servers...] In fact, using a Coin card could be a signal to fraudsters not to commit fraud against your card.
http://www.baltimoresun.com/media/photo/2011-08/64038442.jpg
Not as much as the credit card company (e.g. not the amount of the purchase), but still quite a lot.
Neither are airbags in cars, yet the government stepped in and made them mandatory.
> [Credit card companies] all have the incentive in the world to start rolling out chip and pin technology.
No, their incentive is to make sure people keep using credit cards.
They've done the math and concluded that the amount of user confusion resulting from chip and pin technology resulting in less credit card use is less than the cost of fraud. The fact that chip and pin works in Europe, and also that credit card processors still exist in Europe proves that implementing chip and pin isn't going to drive Visa and Mastercard out of business.
> Neither are airbags in cars, yet the government stepped in and made them mandatory.
that's simply untrue.
http://www.riskworld.com/news/97q1/nw7aa029.htm
this testimony is from 1997, and even with mostly first generation airbags in play at that time it's still wrong.
They are even more effective at saving lives now, and many of the problems with passenger side airbags have now been alleviated.
saved lives = saved money (unless you're looking at cost-to-state of an entire life rather than cost-to-state for medical/funeral costs, but that's outside the scope of this)
Say you sell a camera to someone using a stolen credit card.
The real owner of the card gets his money back after doing a chargeback. The thief keeps the camera. The merchant loses a camera, the money, and gets a ding in his credit card merchant reputation.
Bitcoin, on the other hand, is sided on the other extreme. The merchant has almost all the power. However, the merchant still has a reputation, which might be sufficient incentive.
* the replacement will be when folks like Square, PayPal, etc grow large enough that merchants can replace credit card systems with them for a decent % of customers
On top of that, there's all the convenience issues that plastic brings when out in the real world. Using bitcoin requires a computing device of some sort that's significantly less robust than Coin, a chip & pin card, or a piece of plastic.
I could imagine someone making a credit card that was denominated in bitcoin, but that would be a whole different technology stack than using raw bitcoins.
All of that can be done better though when you get off the credit card rail, which is what I'm working on. tommy@thecityswig.com if you wanna talk