Bitcoin credit cards?

[briehost]

There's no reason to build on top of failed convention. PIN numbers are ==! FTW

2 FA, that's a little more promising. Bio-metric scanning, even better. The sky is the limit on security measures.

I believe consumer financial products should have as much security as the user wishes, and no financial product should be secured by a 4-6 digit numeric password, besides those holding less than a hundred simoleons

[AndrewWilliams]

There's no reason to build on top of failed convention. PIN numbers are ==! FTW

2 FA, that's a little more promising. Bio-metric scanning, even better. The sky is the limit on security measures.

I believe consumer financial products should have as much security as the user wishes, and no financial product should be secured by a 4-6 digit numeric password, besides those holding less than a hundred simoleons

briehost, while those are certainly cool ideas, they are not realistic for getting Bitcoin implemented in the modern day economy.
(Also, bio-metric scanning would take away from the valuable privacy of Bitcoin.)

Unfortunately, cost and adoption is the limit on security measures.

To do what you are suggesting would require terminal manufactures to start making these units, and distribute them. You are talking about a huge scaling.
It will not make sense for a terminal manufacturer to do this for Bitcoin with such low adoption; if anything, it would first need to be adopted by the credit card companies, then Bitcoin.

Right now, terminals cost $100-$400 wholesale. A high tech solution like you propose would cost start at $800 wholesale, huuuuge price difference and merchant's would not want to change out all their terminals, just for Bitcoin. (Avg. merchant has 3 terminals for different lanes.)

Agreed, security ain't what it should be. But right now the goal is mass adoption of Bitcoin, not to rewrite the security protocols of digital transactions.

[briehost]

But right now the goal is mass adoption of Bitcoin, not to rewrite the security protocols of digital transactions.

Very true AndrewWilliams. I was not sure how long-term we were speaking!

I believe the best way to go about this without major overhaul I have seen is definitely something like BitInstant's attempt at creating a pre-paid credit card. You have a deposit address on your card, the private key being held by the card issuer. To reload your card simply send Bitcoin. There is a lot of money to be made by the first to accomplish this. It does require trust of a centralized institution, however you can limit your trust by not depositing your whole hoard to one card, and there is no limit to how many such institutions (issuers) may exist.

[AndrewWilliams]

But right now the goal is mass adoption of Bitcoin, not to rewrite the security protocols of digital transactions.

Very true AndrewWilliams. I was not sure how long-term we were speaking!

I believe the best way to go about this without major overhaul I have seen is definitely something like BitInstant's attempt at creating a pre-paid credit card. You have a deposit address on your card, the private key being held by the card issuer. To reload your card simply send Bitcoin. There is a lot of money to be made by the first to accomplish this. It does require trust of a centralized institution, however you can limit your trust by not depositing your whole hoard to one card, and there is no limit to how many such institutions (issuers) may exist.

I must admit I was a littttttle bit jealous to read about BitInstant doing that, but then I read the article.

All they are doing is converting BTC to fiat and putting that value on a prepaid card. They are just MasterCard prepaid cards. All they are doing is acting as a money exchanger (and with that, privacy is lost to the consumer).
Not a game changer IMO. Nice product for them tho



I'm referring to the next 3-12 months.

[briehost]

Very true, it's not something super complicated. It could have worked if it was not for poor execution.

[AndrewWilliams]

So it failed? :/

[kuusj98]

Would be pretty awesome to say the least.
But you got the companies that take big gambles as value of Bitcoin fluctuates more than USD/EUR

[AndrewWilliams]

Would be pretty awesome to say the least.
But you got the companies that take big gambles as value of Bitcoin fluctuates more than USD/EUR

In my system, the Point of Sale software automatically adjusts the price rung up at the register to reflect the current price in USD, in Bitcoin, using online lookup.

[markjamrobin]

its just if we have bank for bitcoin and then do through this all its better and safe way to use these cards every where

Of course that means that you have to trust the bank.

I suppose eventually there could be bitcoin banks that are insured by a government (equivalent to the current U.S. FDIC), and that are under strict regulation, but we are probably a long way off from anything like that.  It isn't even clear yet if any government or major insurance underwriter would ever be willing to back any bitcoin banks.

The U.S. can't back BTC banks, because they can't print BTC arbitrairly.

[briehost]

So it failed? :/

How long has it been since we've been looking at this page?

Would be pretty awesome to say the least.
But you got the companies that take big gambles as value of Bitcoin fluctuates more than USD/EUR

Not so much a problem if you can find high-volume buyers who want to avoid paying the fees at gox. Not very difficult these days depending on where you are. I feel that there are some services out there which only accept Bitcoin to go long on the currency without paying fees. One example that I have personally used is billpayforcoins.com, though I have only used them for a $50 payment. They offer BTC to USD Check sent anywhere in the US at the bit-pay spot rate. They charge 0% fees and even cover postage.

[arnuschky]

But I think version 9 of the client will allow for zero-confirmation purchases by doing a double-spend check.

What are you trying to say? "Double-spend check"? How is this supposed to work? Reference?

[davidgdg]

Indeed. It is one thing to use a debit or credit card where the bank takes most of the fraud risk. It would be another thing to use some sort of bitcoin card where the person who ends up paying or sorting out the mess if it goes wrong is me.

Where is the risk? If you use your regular debit card at a terminal location, like a gas pump, in which a thief has installed a skimmer and a videocamera to record your PIN number, you will not get your money back.

You are led to believe in a safety net that is not there.

That depends upon the bank and the local law, but certainly in the UK the bank would almost certainly take the loss. Generally speaking over here the customer only bears the loss from fraudulent activity on his account if he has been negligent.  Otherwise the bank (or their insurers) take the hit.

[markjamrobin]

Indeed. It is one thing to use a debit or credit card where the bank takes most of the fraud risk. It would be another thing to use some sort of bitcoin card where the person who ends up paying or sorting out the mess if it goes wrong is me.

Where is the risk? If you use your regular debit card at a terminal location, like a gas pump, in which a thief has installed a skimmer and a videocamera to record your PIN number, you will not get your money back.

You are led to believe in a safety net that is not there.

That depends upon the bank and the local law, but certainly in the UK the bank would almost certainly take the loss. Generally speaking over here the customer only bears the loss from fraudulent activity on his account if he has been negligent.  Otherwise the bank (or their insurers) take the hit.

On credit cards, the person accepting the card takes the risk, because of chargebacks. With BTC, I think the bank or even the user might get screwed.

[jbreher]

To break it down, when the customer enters in the PIN number via the terminal, this "unlocks" the Bitcoin address private key to proceed with the transaction. The transaction amount displays on the terminal screen, and the customer presses OK if it is correct. Simple.

So the machine -- 'PCI Compliant' or not -- signs the transaction with your private key, which you have exposed to it using your PIN? No thanks.

About the day after this gets introduced, somebody is going to create look-alike terminals that send your private key to haxxors in the Ukraine. How would one be able to tell you're dealing with an actual, non-nefarious terminal?

Really? Like seriously?

Then you might as well never use a debit or credit card terminal ever again. Let me know how that works out

Unrelated scenario is unrelated.

Credit card companies are trusted central points of control. No card is even required. Certainly, you've verbally authorized purchases before? The only reason the CC system works at all, it that CC companies make defrauded CC holders whole after any fraud.

In bitcoin, there is no such central party. Once your key is in the wild, nobody can recall it.

Sorry but this is the real world. If you are that paranoid just stick to cash

How would one be able to tell you're dealing with an actual, non-nefarious terminal?
If you go to a legit store, you will be dealing with a legit terminal.

Bullshit. There is a vast spectrum of 'stores' from mobile kisoks using their iPhones to connect to CC networks, to WalMart. Again, if you cannot see that you have _no way_ to determine whether your are swiping a genuine certified* known bitcoin terminal, or a clever visual copy created by nefarious individuals, than I claim you are being intentionally obtuse.

*I assume you are envisioning some certification process, as I imagine is required for PCI compliance.

[jbreher]

I thought that what was being proposed was just a credit or debit card where you have a BTC denominated bank account.

I thought so too, until this flight of fancy about the terminal appeared.

Incidentally, there are solutions involving MasterCard-branded debit cards, loaded via bitcoin. I had one for a bit, until the issuing bank got scared off by our insane US finance regulations. Last I looked, they were still available to people who live outside the USA.

[johnchloee]

The points which are mentioned in this thread are correct but the usage of credit card members are increased day-by-day. Can you share some more information regarding this.


gspay scam

[howardb]

Would make sense for some truly trusted institution to issue a practical physical currency backed by Bitcoin (as apposed to the current novelty coins) just like the old gold standard! Ironically we would then have the opposite of the fiat notes having to issue bigger denominations from time to time, we would need smaller and smaller ones!

But seriously, this would at a stroke put bitcoin in the hands of the worlds unbanked, none internet connected masses, as well as solving the confirmation time issue for at till transactions.

[supersajin]

The day Bitcoin manages to put Bitcoin purchasing power into the hands of the masses i.e. credit card is the day we see mass adoption and see 2-3-4-5K Bitcoin price.

[Nathonas]

Do you think a Bitcoin credit card could succeed as a mainstream form of payment?

As in, the credit card contains your wallet number as a credit card has a credit card number...

Thoughts appreciated  

How do you deal with people that don't pay back what they owe? Bitcoin is decentralized, that's a big part of the innovation of the currency. Also personally, I hate credit cards. They're nothing but a way to put people into debt and buy shit they can't afford.

[kies1107]

Amount shows on the terminal for your approval (much like a debit transaction). You press Yes (green) to accept, or Cancel (red) to decline.
Perhaps a pin code could be added somehow, this would be very hard to implement universally though, and I don't think it would be feasible, at least not at first.