Bitcard - an idea for fast transactions on the street

[TiagoTiago]

This is somthing i thought about reading some of those threads about physical bitcoins.


It would work kinda like a debit card.


You carry with yourself a smart card containing your identification with the "bank" and some challenge response software to prove the card really is authentic and it's the one associated with your account (instead of just an ID number that needed to be made public, exposing the card to clonation).

Bitcoins you own are deposited into your account in the "bank".

You go to a store, and when it's time to pay, you present your card, the cashier places it into the machine and the machine talks with the bank securelly, confirms that you have the funds, and then tells you how much the cashier is asking you and requests your password or signature or somthing like that to authorize the transfer.


If you go ahead with it, the "bank" subtracts that ammount from your balance and triggers the transfer in the Bitcoin network (making transactions transparent), but instantly adds that ammount to the store's balance (everyone involved trusts the bank to keep it's word, the bank got some additional reserve to cover times when the network takes too long etc) and transfers between accounts on the same bank are presented to customers not as the raw current state of the bitcon addresses but as the instantaneous layer, the result of all transfers pending or verified by the network; transfers to other banks, or to arbitrary bitcoin addresses remove the amount from the bank account balance instantaneouslly, but from the receiver's point of view is just a regular bitcoin transfer.



I know that this has most of the issues associated with centralization, single point of failure and stuff, but i would think this would be quite usefull for regular people on their daily life.

And it got several benefits over carrying a whole device running it's own bitcoin client, like:

* Instant trusted payments

* Can fit inside your wallet

* All the technology already exists and people are used to using it already.


And it stil works on top of the bitcoin network without competing with.




Eventually there might be some laws forcing people to provide true documents relating to their identity to the banks/operators, but till then, just going into an agency (or perhaps even online) transfering some money to a new address owned by then would be enough to get you an account and a card for that account. And from then on all you need to provide to receive money is the account id (for transfer from another account in the same bank) or the bitcoin address of the account (for transfers using just the bitcoin network), and stores and other places  could buy a compatible machine, program their account id in, and plug it to the Internet and they're set. Without a machine to make transfers you could still do it with things like webbanking, thru the phone, going into a physical agency etc.





This still wouldn't completly replace paper govt money with bitcoin, but would make it compete with it, or rather with "plastic money" and other instances where people pay and receive govt money without actually seeing the paper notes.

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I'd rather have a bitcoin client and wallet right on the card. It's probably a bit heavy for what today's cards are capable of, though.

[TiagoTiago]

That wouldn't be trustworthy enough for going to stores and buying things, the stores wouldn't like having to wait from ten mninutes to half a day or more to know whether you really paid them or if you had already sent the money to somewhere else.

[stakhanov]

I'd rather have a bitcoin client and wallet right on the card. It's probably a bit heavy for what today's cards are capable of, though.

But it would be a perfect match for current smartphones

[Dude65535]

Without a trusted third party holding the funds I imagine bitcoin use at a store would work much like writing a check. The store might want to see some ID and get your signature. That way they have some way of tracking you down if they never get their bitcoins.

[TiagoTiago]

Aceptance in stores would be much easier if they had guarantees they would most likelly not need to get the law involved to see their money; and bitcards can still provide some of the anonimity of paper cash, without the delay and the need to trust random strangers from raw bitcoin transactions.

[TiagoTiago]

Just bumping it 'cause i corrected a few typos and adjusted the wordng here and there in the op.

[FatherMcGruder]

This still wouldn't completly replace paper govt money with bitcoin, but would make it compete with it, or rather with "plastic money" and other instances where people pay and receive govt money without actually seeing the paper notes.

Why couldn't mutual banks issue paper money backed with bitcoins?

[TiagoTiago]

I would expect that would cost them way more than debit cards, both initially and as the time goes by.

[FatherMcGruder]

I would expect that would cost them way more than debit cards, both initially and as the time goes by.

Yes, but paper money transactions aren't public. People find that useful.