A "real" Bitcoin

[tcatm]

I just made a "real" bitcoin. They'll eventually be made of real metal instead of glass epoxy + copper once I have better tools.

http://a59.img-up.net/bitcoin2d08rj.jpg

[grondilu]

I just made a "real" bitcoin. They'll eventually be made of real metal instead of glass epoxy + copper once I have better tools.

http://a59.img-up.net/bitcoin2d08rj.jpg

Pretty cool.  A gold coin like this would be nice.

Anyone knows someone who could mint it ?

[Gavin Andresen]

Yeah, cool!

Could you punch a couple of holes through the B?  I like topologically interesting money.

And if you want to make it the absolutely coolest coin in the world, generate a new bitcoin address, send 1 bitcoin to it, and then engrave that address on the coin.

Then you have physical currency that the owner can independently check to make sure the bitcoin backing it hasn't been spent.

[tcatm]

High resolution picture:

http://y72.img-up.net/bitcoin3d6phb.jpg

Next I'll try to make one from brass. I like the idea of engraving an bitcoin address.

[dingus]

High resolution picture:

http://y72.img-up.net/bitcoin3d6phb.jpg

Next I'll try to make one from brass. I like the idea of engraving an bitcoin address.

Perhaps engraving the circle on the coin with the address would work, I am not sure it would fit though.

[kiba]

What if there are more  real bitcoin then there are real bitcoin in a wallet?

[tcatm]

How about for the bitcoin address, engrave it along the edge like the new US dollar coins.

Good idea but I'd need to make the coin bigger for that and build a custom CNC

Btw: The coin is up for auction until block 101000 (current bid 40 BTC). Please join #bitcoin-auction to place bids.

[nanotube]

shipping included?

[tcatm]

shipping included?

If it's not extremely expensive (i.e. more than half of the bid), yes.

[nanotube]

Yeah, cool!

Could you punch a couple of holes through the B?  I like topologically interesting money.

And if you want to make it the absolutely coolest coin in the world, generate a new bitcoin address, send 1 bitcoin to it, and then engrave that address on the coin.

Then you have physical currency that the owner can independently check to make sure the bitcoin backing it hasn't been spent.

yea, except you run into a problem of coin duplication. i can make 20 coins with the same address (which has 1 btc associated with it), and pass them all off as 1btc worth. unless there's some kind of a central registry of coins by address+owner, so that one can check that the guy who's passing him the coin is indeed the only owner of a coin with such and such address, etc... but then you lose the 'decentralized' bit.

[Anonymous]

Can you sandwich two metal halves together and have a wallet chip between them?

Just say you could externally scan the coin and determine it has a value inside it....

[Vinnie]

And if you want to make it the absolutely coolest coin in the world, generate a new bitcoin address, send 1 bitcoin to it, and then engrave that address on the coin.

Then you have physical currency that the owner can independently check to make sure the bitcoin backing it hasn't been spent.

Alternatively you could simply make the market for them, buying and selling them at a +.01 to -.01 spread. Then instead of having a backed currency you would have a pegged currency. The advantages of a pegged currency is that it would be possible to expand the money supply based on actual demand rather than target interest rates.

[Mike Hearn]

It'd be cool to come up with a coin design that's RepRappable. It'd fit well with the decentralized philosophy of BitCoin :-)

http://reprap.org/

For making it an actual coin that's useful for transactions, you could embed an NFC chip into it. The tag chips cost about a dollar, I think, and can store small amounts of arbitrary data that can then be read by near field radio. It'd probably be possible to fit a keypair into it.

[MacRohard]

High resolution picture:

http://y72.img-up.net/bitcoin3d6phb.jpg

Next I'll try to make one from brass. I like the idea of engraving an bitcoin address.

What you really need is a way to write the private key that controlls 1 bitcoin onto the coin (some small smartcard? or maybe just a hexdump in really tiny writing) - that way someone could dematerialize the coin again if they want and put it back into a wallet.

Just having an address with a coin in it that noone can access is kindof pointless. Including the real private key on the other hand would allow the value of the bitcoin to remain pegged.

[casascius]

High resolution picture:

http://y72.img-up.net/bitcoin3d6phb.jpg

Next I'll try to make one from brass. I like the idea of engraving an bitcoin address.

What you really need is a way to write the private key that controlls 1 bitcoin onto the coin (some small smartcard? or maybe just a hexdump in really tiny writing) - that way someone could dematerialize the coin again if they want and put it back into a wallet.

Just having an address with a coin in it that noone can access is kindof pointless. Including the real private key on the other hand would allow the value of the bitcoin to remain pegged.

If only you could stuff this inside it...

http://h22.img-up.net/?up=coin6fzzg.jpg

[Anonymous]

High resolution picture:

http://y72.img-up.net/bitcoin3d6phb.jpg

Next I'll try to make one from brass. I like the idea of engraving an bitcoin address.

What you really need is a way to write the private key that controlls 1 bitcoin onto the coin (some small smartcard? or maybe just a hexdump in really tiny writing) - that way someone could dematerialize the coin again if they want and put it back into a wallet.

Just having an address with a coin in it that noone can access is kindof pointless. Including the real private key on the other hand would allow the value of the bitcoin to remain pegged.

If only you could stuff this inside it...

http://h22.img-up.net/?up=coin6fzzg.jpg

You could have a mold and pour liquid metal into it.....

[Anonymous]

It'd be cool to come up with a coin design that's RepRappable. It'd fit well with the decentralized philosophy of BitCoin :-)

http://reprap.org/

For making it an actual coin that's useful for transactions, you could embed an NFC chip into it. The tag chips cost about a dollar, I think, and can store small amounts of arbitrary data that can then be read by near field radio. It'd probably be possible to fit a keypair into it.

I think they are working on a machine that can print electronic parts such as circuit boards. It would be a cool project to get involved with.

[MacRohard]

High resolution picture:

http://y72.img-up.net/bitcoin3d6phb.jpg

Next I'll try to make one from brass. I like the idea of engraving an bitcoin address.

What you really need is a way to write the private key that controlls 1 bitcoin onto the coin (some small smartcard? or maybe just a hexdump in really tiny writing) - that way someone could dematerialize the coin again if they want and put it back into a wallet.

Just having an address with a coin in it that noone can access is kindof pointless. Including the real private key on the other hand would allow the value of the bitcoin to remain pegged.

If only you could stuff this inside it...

http://h22.img-up.net/?up=coin6fzzg.jpg

perhaps this;

http://www.alibaba.com/product-free/103998637/Smart_card_Coin_card.html

[Anonymous]

High resolution picture:

http://y72.img-up.net/bitcoin3d6phb.jpg

Next I'll try to make one from brass. I like the idea of engraving an bitcoin address.

What you really need is a way to write the private key that controlls 1 bitcoin onto the coin (some small smartcard? or maybe just a hexdump in really tiny writing) - that way someone could dematerialize the coin again if they want and put it back into a wallet.

Just having an address with a coin in it that noone can access is kindof pointless. Including the real private key on the other hand would allow the value of the bitcoin to remain pegged.

If only you could stuff this inside it...

http://h22.img-up.net/?up=coin6fzzg.jpg

perhaps this;

http://www.alibaba.com/product-free/103998637/Smart_card_Coin_card.html

That looks great,if a little uninspiring  


Wouldnt mind a real bitcoin I could keep in a safe somewhere or even hand out as a business card.  http://www.flipsidewallet.com/ id carry an rfid bitcoin smart card in this lol

[genjix]

That coin is a very cool momento. You should consider selling that merchandise.

Real bitcoin currency though would just be hard-to-manufacture paper notes with a barcode that has an address with 1 BTC in.

[tcatm]

That coin is a very cool momento. You should consider selling that merchandise.

I'm working on it. I'm currently trying to make a copper core + gold surface coin.

[nanotube]

100925 blocks. 75 blocks until auction end.

[Luke-Jr]

That coin is a very cool momento. You should consider selling that merchandise.

Real bitcoin currency though would just be hard-to-manufacture paper notes with a barcode that has an address with 1 BTC in.

So transfer that BTC to your own address, and pass the paper on? Nah, you need some kind of scratch-off to show it's used

[grondilu]

IMO, you're taking this way too seriously guys.

A physical bitcoin is cool, but it's nothing but symbolic.  There is obviously no way to have any physical object store a bitcoin.  Otherwise we wouldn't need bitcoin in the first place.  A physical object can be counterfaited, and if you plan on putting ECDSA keys in it, it can be copied.  And you still have the double spending problem.  And I'm sure there are many other reason why a physical bitcoin can be nothing but some kind of a marketing toy or something alike.

Still, I'd like to have one.  Especially if it's solid gold.

[casascius]

IMO, you're taking this way too seriously guys.

A physical bitcoin is cool, but it's nothing but symbolic.  There is obviously no way to have any physical object store a bitcoin.  Otherwise we wouldn't need bitcoin in the first place.  A physical object can be counterfaited, and if you plan on putting ECDSA keys in it, it can be copied.  And you still have the double spending problem.  And I'm sure there are many other reason why a physical bitcoin can be nothing but some kind of a marketing toy or something alike.

Still, I'd like to have one.  Especially if it's solid gold.

I assert that a smart card is a physical object that can securely store a bitcoin.

A smart card is an integrated circuit that, among other things, can store a private key and sign things with it without divulging the private key.  A smart card can also enforce pre-programmed constraints by itself.  Many smart cards can generate public/private key pairs on-chip, and encrypt/decrypt data streams in real time.

[grondilu]

I assert that a smart card is a physical object that can securely store a bitcoin.

A smart card is an integrated circuit that, among other things, can store a private key and sign things with it without divulging the private key.  A smart card can also enforce pre-programmed constraints by itself.  Many smart cards can generate public/private key pairs on-chip, and encrypt/decrypt data streams in real time.

Yeah but to pay with a smartcard, you don't give the smartcard !  It's a completely dofferent purpose than a monetary token.

[casascius]

Yeah but to pay with a smartcard, you don't give the smartcard !  It's a completely dofferent purpose than a monetary token.

Why not?  A smart card can be given away just like any other tangible object.

[grondilu]

Why not?  A smart card can be given away just like any other tangible object.

Am I missing something or what ?  If you give the smartcard, the only way for the receiver to check that it realy has some value is to proceed to a transfer.  Then the card doesn't have any value anymore.  So what's the point of keeping it ?

[casascius]

Why not?  A smart card can be given away just like any other tangible object.

Am I missing something or what ?  If you give the smartcard, the only way for the receiver to check that it realy has some value is to proceed to a transfer.  Then the card doesn't have any value anymore.  So what's the point of keeping it ?

If the smart card had a custom application that simply proved that it contained the private key associated with some real Bitcoins out there, the value could be checked simply by confirming that the corresponding Bitcoin address had a balance.

If the Bitcoin system allowed bitcoins to be encumbered by TWO private keys instead of one, and the second one were settable by any user in possession of the card (a change would be announced to the blockchain so it would be enforced by all nodes), it would eliminate the risk that someone who secretly acquired the private key within the card (e.g. the manufacturer) could spend the coins after he had given away the card.

[grondilu]

If the smart card had a custom application that simply proved that it contained the private key associated with some real Bitcoins out there, the value could be checked simply by confirming that the corresponding Bitcoin address had a balance.

If the Bitcoin system allowed bitcoins to be encumbered by TWO private keys instead of one, and the second one were settable by any user in possession of the card (a change would be announced to the blockchain so it would be enforced by all nodes), it would eliminate the risk that someone who secretly acquired the private key within the card (e.g. the manufacturer) could spend the coins after he had given away the card.

It seems to be quite complicated but I guess it's possible.

I don't think it would harm the bitcoin network anyway, so go for it.

[casascius]

It seems to be quite complicated but I guess it's possible.

I don't think it would harm the bitcoin network anyway, so go for it.

Here's some context:

http://img810.imageshack.us/i/photoph.jpg/

These credit card machines are nothing more than simple desktop computers with a POSIX-like proprietary OS that can be written to in C / C++.  This is a "proof of concept" video poker application I wrote for the VeriFone Vx series credit card machines.

Each of these machines has a smart card reader, and the API allows the sending and receiving of arbitrary commands to the smart card... a smart card with custom application can handle these however it has been programmed.

edited to add: the real obstacle is that it would be necessary for Bitcoin to allow bitcoins to be encumbered by a second private key.  Otherwise all kinds of attacks are trivial.  Someone suggested this was already possible - I'm afraid I don't understand the workings of the Bitcoin protocol well enough at this point to say whether or not that was so.

[Pegasus-Rider]

I would like to see a traditional coin representing BTC, and I see it as follows:
It would be made of a valuable metal or alloy (Germanium-Titanium sounds extremely attractive, particularly because of its bit-significance), with Bitcoin symbols and guarantee to exchange such tokens for bitcoins, effectively making these representative money with a meaningful value of their own.
For minting we may refer to Wirtland project experience and perhaps even propose bitcoin as their currency on this occasion.
How does it sound?

[Vinnie]

If and when BTC becomes more widely accepted, I'd consider starting a physical currency that is pegged to bitcoins.

[jgarzik]

Am I missing something or what ?  If you give the smartcard, the only way for the receiver to check that it realy has some value is to proceed to a transfer.  Then the card doesn't have any value anymore.  So what's the point of keeping it ?

A physical-world digital store of money has many uses.  Anonymous, reloadable VISA debit cards are quite popular, for example.  A card would be nothing more than an anonymous bitcoin wallet.

Currently bitcoins are as portable as your computer...  but they could be more portable with a smartcard.

Simply handing someone a card is a useful way to move money.

[Pegasus-Rider]

If and when BTC becomes more widely accepted

It might be this very initiative that will help to popularise Bitcoin - you know, a /. post about it, news site articles and so on.

[Vinnie]

If and when BTC becomes more widely accepted

It might be this very initiative that will help to popularise Bitcoin - you know, a /. post about it, news site articles and so on.

True. What do you think; paper bills or coins?

[ribuck]

If and when BTC becomes more widely accepted, I'd consider starting a physical currency that is pegged to bitcoins.

Fractional reserve banking, in other words. I'm not criticizing though. It's inevitable, and it's harmless provided the level of backing behind the "pegging" is honestly disclosed.

[Vinnie]

Fractional reserve banking, in other words. I'm not criticizing though. It's inevitable, and it's harmless provided the level of backing behind the "pegging" is honestly disclosed.

I suppose you could call it that. I envision an issuer as making the market for the currency, rather than accepting deposits and issuing bearer certificates. Perhaps its just semantics, but in making the market for a pegged currency for an honest, razor thin spread, an issuer would demonstrate a consistent commitment to maintain its trade value at face value.

[em3rgentOrdr]

This whole discussion reminds me of the "Printing Bitcoins : Could it Work?" discussion.

It'd be cool to come up with a coin design that's RepRappable. It'd fit well with the decentralized philosophy of BitCoin :-)

http://reprap.org/

For making it an actual coin that's useful for transactions, you could embed an NFC chip into it. The tag chips cost about a dollar, I think, and can store small amounts of arbitrary data that can then be read by near field radio. It'd probably be possible to fit a keypair into it.

I like that idea.  Where can I buy a NFC chip today for a dollar?

IMO, you're taking this way too seriously guys.

A physical bitcoin is cool, but it's nothing but symbolic.  There is obviously no way to have any physical object store a bitcoin.  Otherwise we wouldn't need bitcoin in the first place.  A physical object can be counterfaited, and if you plan on putting ECDSA keys in it, it can be copied.  And you still have the double spending problem.  And I'm sure there are many other reason why a physical bitcoin can be nothing but some kind of a marketing toy or something alike.

Still, I'd like to have one.  Especially if it's solid gold.

I like the idea of backing gold with something of real value, like bitcoin.  Heck, fundamentally, gold is currently "backed by nothing!" (deliberate scare quotes)  

I assert that a smart card is a physical object that can securely store a bitcoin.

A smart card is an integrated circuit that, among other things, can store a private key and sign things with it without divulging the private key.  A smart card can also enforce pre-programmed constraints by itself.  Many smart cards can generate public/private key pairs on-chip, and encrypt/decrypt data streams in real time.

EXACTLY!  Excellent idea.  Just embed this bitcoin smart card chip with NFC inside of a plastic rep-rap or makerbot plastic 'coin' and you have a "real" bitcoin!

However, is there a way that you can verify the bitcoin wallet that you embed inside this smart card chip has NO OTHER COPIES?  Potentially, couldn't the manufacturer or distributor of these bitcoin smart cards keep a backup of the wallet at their company headquarters when they first create the bitcoin smart card?  I guess maybe you can't trust a pre-loaded bitcoin smart card, and instead can only trust bitcoin smartcards that you generate a new address inside it yourself which gets sent a bitcoin.

[Vic]

For minting we may refer to Wirtland project experience and perhaps even propose bitcoin as their currency on this occasion.
How does it sound?

Wirtland would be glad to collaborate, I guess. (By the way, our next physical coin will be with Julian Assange portrait, see http://www.tiny.lu/o27px!)  But I have to agree that a smart card, such as an anonymous VISA, would be much better for practical use. In fact, Wirtland has been discussing this for a long time. Wirtland issues plastic IDs, and wants to have them serve for payments - by inserting chip, magnetic band or other technology.

[casascius]

I assert that a smart card is a physical object that can securely store a bitcoin.

A smart card is an integrated circuit that, among other things, can store a private key and sign things with it without divulging the private key.  A smart card can also enforce pre-programmed constraints by itself.  Many smart cards can generate public/private key pairs on-chip, and encrypt/decrypt data streams in real time.

However, is there a way that you can verify the bitcoin wallet that you embed inside this smart card chip has NO OTHER COPIES?  Potentially, couldn't the manufacturer or distributor of these bitcoin smart cards keep a backup of the wallet at their company headquarters when they first create the bitcoin smart card?  I guess maybe you can't trust a pre-loaded bitcoin smart card, and instead can only trust bitcoin smartcards that you generate a new address inside it yourself which gets sent a bitcoin.

Bitcoin has the ability to encumber coins with multiple keys and specify that "all" of them are needed to spend the coins.  It's not visible in the user interface, but it exists in the protocol.  A viable "tangible" bitcoin would be backed by coins that are secured by at least two keys.  One of them would be put there by the manufacturer, the other would would be field-changeable by any user in possession of the card.  If the manufacturer of the card does not have ALL the keys encumbering the card, he cannot steal the coins.

This would also guard against copies.  The moment any user rekeyed that second key, all other copies would be void the moment the rekeying hit the block chain.

[em3rgentOrdr]

I assert that a smart card is a physical object that can securely store a bitcoin.

A smart card is an integrated circuit that, among other things, can store a private key and sign things with it without divulging the private key.  A smart card can also enforce pre-programmed constraints by itself.  Many smart cards can generate public/private key pairs on-chip, and encrypt/decrypt data streams in real time.

However, is there a way that you can verify the bitcoin wallet that you embed inside this smart card chip has NO OTHER COPIES?  Potentially, couldn't the manufacturer or distributor of these bitcoin smart cards keep a backup of the wallet at their company headquarters when they first create the bitcoin smart card?  I guess maybe you can't trust a pre-loaded bitcoin smart card, and instead can only trust bitcoin smartcards that you generate a new address inside it yourself which gets sent a bitcoin.

Bitcoin has the ability to encumber coins with multiple keys and specify that "all" of them are needed to spend the coins.  It's not visible in the user interface, but it exists in the protocol.  A viable "tangible" bitcoin would be backed by coins that are secured by at least two keys.  One of them would be put there by the manufacturer, the other would would be field-changeable by any user in possession of the card.  If the manufacturer of the card does not have ALL the keys encumbering the card, he cannot steal the coins.

This would also guard against copies.  The moment any user rekeyed that second key, all other copies would be void the moment the rekeying hit the block chain.

I like that idea of using multiple keys...

[TiagoTiago]

I can see a future where "paper" money will contain flexible electronics and display tecnology, a single note will be capable of holding any amount of bitcoins you transfer to it (it will be a physical standalone wallet), and will change it's appearance to reflect it's contents; you will be able to exchange notes without using any network, or even electricity, like how you exchange paper money nowadays,  but with a device (any one of the many types that will be avaible) you will have the ability to redistribute the Bitcoins between notes as well between notes and other wallet storage means. (An empty note would only have a very small value simply for the benefits it has for exchanging Bitcoings instantly and without needing any connection or energy once charged, they would be made in great numbers, so many that people will feel more confortable throwing away an empty one than people nowadays feel about leafs falling from trees)

[Local]

I can see a future where "paper" money will contain flexible electronics and display tecnology, a single note will be capable of holding any amount of bitcoins you transfer to it (it will be a physical standalone wallet), and will change it's appearance to reflect it's contents; you will be able to exchange notes without using any network, or even electricity, like how you exchange paper money nowadays,  but with a device (any one of the many types that will be avaible) you will have the ability to redistribute the Bitcoins between notes as well between notes and other wallet storage means. (An empty note would only have a very small value simply for the benefits it has for exchanging Bitcoings instantly and without needing any connection or energy once charged, they would be made in great numbers, so many that people will feel more confortable throwing away an empty one than people nowadays feel about leafs falling from trees)

If I have a wallet with bitcoins I can put that file on all my computers simultaneously. When I spend them they are gone from all computers. I can do the same with the suggested bills. If there is a way to put them on one then I can put them on many. The network is required for preventing double spending. You either have to trust the person you are trading with or you have to be on the network.

[kiba]

Just use your 5 BTC(price deflation + cheap phones!) smartphone of the near future as your wallet.

[barbarousrelic]

If and when BTC becomes more widely accepted, I'd consider starting a physical currency that is pegged to bitcoins.

Fractional reserve banking, in other words. I'm not criticizing though. It's inevitable, and it's harmless provided the level of backing behind the "pegging" is honestly disclosed.

It would not be fractional if each physical coin was backed by one digital coin.

[TiagoTiago]

The devices that redistribute Bitcoins between notes would be connected to the network. The notes don't got copies of your wallet, they are a wallet on their own, when transfering Bitcoins you're really transfering Bitcoins, not copying wallets.

[Local]

  ...you will be able to exchange notes without using any network...

This is why I thought you were talking about trading without being on the network. Of course if you are on the network your idea works fine.

[TiagoTiago]

Without the devices, the notes are offline wallets.

[Quip]

Alternatively you could simply make the market for them, buying and selling them at a +.01 to -.01 spread. Then instead of having a backed currency you would have a pegged currency. The advantages of a pegged currency is that it would be possible to expand the money supply based on actual demand rather than target interest rates.

I also think a physical currency pegged to Bitcoin would be very interesting. The biggest trouble would be making the coins cheaply enough.

For making it an actual coin that's useful for transactions, you could embed an NFC chip into it. The tag chips cost about a dollar, I think, and can store small amounts of arbitrary data that can then be read by near field radio. It'd probably be possible to fit a keypair into it.

I think that NFC smartcards containing entire Bitcoin wallets would be far more practical than NFC "coins" containing 1 BTC each. You could even program NFC-enabled smartphones to emulate the smartcards.

[Dude65535]

A physical bitcoin that contained a usb drive with the bitcoin software and a wallet with a balance of 1 BTC would make a very good promotional item for bitcoin. That would be a lot easier than any system for secure transfer of bitcoins via a physical object.

[em3rgentOrdr]

A physical bitcoin that contained a usb drive with the bitcoin software and a wallet with a balance of 1 BTC would make a very good promotional item for bitcoin. That would be a lot easier than any system for secure transfer of bitcoins via a physical object.

Great idea...  You are a very smart person...  I wish I could have thought of such a simple idea.

[grondilu]

Hopefully someone will soon compile bitcoin on a smartcard. 

[ArsenShnurkov]

A physical bitcoin that contained a usb drive with the bitcoin software and a wallet with a balance of 1 BTC would make a very good promotional item for bitcoin.

I have a wallet with 1BTC-smartcards. I am giving one coin the to the other human.

How that other human will be able to check that smartcards actually contain coins?
If coins are already spent than such "physical coin" will be of zero value.

How other human can be sure, that you have not make a backup of the "physical coin" ?
(I imply, thath it is impossible to transfer money from "physical coin" to another wallet, because there is no direct internet access.)
If there is a backup - there is a risk of spending BTC from that backup.

[Dude65535]

Did you quote the wrong person? I was suggesting a promotional item that could be given away to increase interest in bitcoin. If the coins are still available they can move them to another bitcoin address if not the person receiving it is only out the time it took to check the balance.


A secure physical token for storing BTC would need to never divulge its private key and be able to produce a transaction when given a address to send the coins to. It would also need to have some indicator on it to show if it had produced such a transaction and was therefore worthless.

If the token could verify that it had access to a reliable copy of the block chain it could be reloadable.

For any of that to work people would need to trust the hardware and its manufacturer.

[casascius]

A secure physical token for storing BTC would need to never divulge its private key and be able to produce a transaction when given a address to send the coins to. It would also need to have some indicator on it to show if it had produced such a transaction and was therefore worthless.

If the token could verify that it had access to a reliable copy of the block chain it could be reloadable.

For any of that to work people would need to trust the hardware and its manufacturer.

Trust of hardware and manufacturer can be resolved by encumbering coins with two private keys instead of one, something the Bitcoin client already supports through its "scripting" engine.  One key hardcoded by the manufacturer, the second changeable by a power user.  Once the second private key is changed, the manufacturer can't repossess the coins, and this also guards against the manufacturer making multiple cards with the same private key.

The token itself doesn't necessarily need access to the block chain, as long as it can be stuck into a reader that can perform these functions and has access to the block chain.  (e.g. VeriFone Vx570 credit card reader with smart card option installed, and a custom C/C++ app that as of yet has not been written)

[TiagoTiago]

What if the physical thing was a token kinda like those PRNG some banks give their clients to perform webbanking operations, but instead of running a PRNG it got a wallet file and a wallet managing software, using NFC or some contact based or wireless protocol to interface with devices that can share their internet connection for changing the contents of the token?

[Dude65535]

The token itself doesn't necessarily need access to the block chain, as long as it can be stuck into a reader that can perform these functions and has access to the block chain.  (e.g. VeriFone Vx570 credit card reader with smart card option installed, and a custom C/C++ app that as of yet has not been written)

The main thing is the token needs some way to know for certain it isn't being lied to when it is told that it has the proper balance in its account. That way you can trust the indicator on the token to be an accurate sign of the value of the token.

[casascius]

The token itself doesn't necessarily need access to the block chain, as long as it can be stuck into a reader that can perform these functions and has access to the block chain.  (e.g. VeriFone Vx570 credit card reader with smart card option installed, and a custom C/C++ app that as of yet has not been written)

The main thing is the token needs some way to know for certain it isn't being lied to when it is told that it has the proper balance in its account. That way you can trust the indicator on the token to be an accurate sign of the value of the token.

The token does not need to know its balance. Why would it?

[Dude65535]

The token would have the only copy of the private key and not disclose it for any reason. If you wanted to remove the bitcoins you would send a receiving address to the token and it would return a transaction you could send to the network. At this point the token would assume that the balance was gone and change the built in indicator to show this. That way someone could not pass of the token as still having value.

For reloading you would have the token generate a new private key and send coins to its public address. Then once that was confirmed by the block chain you could go to a kiosk owned by the token manufacturer and reset the indicator to show that the balance was present.

This would allow you to be certain of the value of the token without any connection to the bitcoin network.

[casascius]

The token would have the only copy of the private key and not disclose it for any reason. If you wanted to remove the bitcoins you would send a receiving address to the token and it would return a transaction you could send to the network. At this point the token would assume that the balance was gone and change the built in indicator to show this. That way someone could not pass of the token as still having value.

For reloading you would have the token generate a new private key and send coins to its public address. Then once that was confirmed by the block chain you could go to a kiosk owned by the token manufacturer and reset the indicator to show that the balance was present.

This would allow you to be certain of the value of the token without any connection to the bitcoin network.

I still don't see why a token needs to be told its value, except perhaps at the moment you're asking it to sign a transaction.

If you're sending it an address to remove the bitcoins, why can't the amount be sent at this time?

If you need a reader to read out the fact that the token has any given balance, couldn't that same reader just tell from the block chain?  It would be more accurate that way.

Unless someone wants to make a closed proprietary system like Visa, and implement "security by obscurity" like the satellite companies do (which are constantly getting hacked), such a "token" would most likely be an industry standard smart card - which could be programmed to do anything, like lie about its balance.  I wouldn't consider it secure to believe a token that self-reports its own balance.    It is best if the smart card is "trusted" only to keep secrets, not to tell the truth.

If you want to experiment with smart cards - consider basiccard.com - which looks like an entry level system for user-programmable smart cards.

[Dude65535]

The token could freely disclose its public address for independent confirmation of the balance.(edit: it could also freely provide a 0 BTC sample transaction to prove it had the matching private key) However if you have internet access at the time of the transaction to confirm the balance there are probably better ways to transfer bitcoins than transfer of a physical object.

For simplicity of hardware the token would probably have a fixed face value in bitcoins and the indicator would just be a yes/no for the security of that balance, that could just be a led that lights red or green when a button on the token is pressed.

[RSantana]

I know this thread is old, but I just go through reading it and thought some of you might be interested in the physical bitcoins I've manufactured.

http://CoinedBits.com

[greekminer]

Very nice!