Topic: Bitcoin credit cards? - page 2. (Read 6599 times)
Very true, it's not something super complicated. It could have worked if it was not for poor execution.
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.
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.
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
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.
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
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
Okay, seriously, couldn't a corporation similar to a Building Society hold your Bitcoins off-the-chain for things like debit card payments? Much easier than having your private key exposed, and it's pretty safe.
You could, it's just not necessary and just invites problems.
Private key would not be exposed with encrypted debit chip, as it is not with current chipped debit cards.
Okay, seriously, couldn't a corporation similar to a Building Society hold your Bitcoins off-the-chain for things like debit card payments? Much easier than having your private key exposed, and it's pretty safe.
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.
So instead you want a private company like Mt. Gox to hold your hand if anything bad happens?
What happened to self responsibility.
Making a Mt. Gox like company in charge of chargebacks and disputes is an accident waiting to happen.
You are basically putting that private company at huge risk of having funds seized or stolen.
Then you want to rely on them for chargebacks??? That's madness. You are giving a private company, without any oversight, the ability to manipulate transactions. They can steal merchant's and consumer's money using the chargeback model. It's ridiculous.
Just dont use Bitcoin Credit Card for risky transactions. Use it when buying a coffee. Use it when buying groceries. Use it when buying furniture. Don't use it to order things online or over the phone. That simple.
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.
Essentially what is being suggested is a scenario where you tell each and every merchant that you do business with where you've stored a big box filled with cash. You continuously add cash to this box as needed. The merchants then go to your box of cash and remove the amount that you've asked them to remove for payment of whatever you are purchasing. You agree not to move the box at all, and you trust (hope?) that the merchant will never use their knowledge of the location of the box to go take additional cash that you haven't authorized no matter how desperate they become.
And this is being offered as equivalent to the current credit/debit card security.
You can see how when you think about bitcoin as a currency instead of a payment network, some of the concepts start to fall apart.
I fail to see your point.
Why is the technology used for debit transaction using encrypted PINs, NOT good enough for Bitcoin?
It's been used on a scale at least 1,000 X larger than Bitcoin, and has succeeded. Why reinvent the wheel?
A network is only going to be as secure as the users using it.
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You aren't paying attention.
No, you aren't. Just because you were covered on your theft, it is not the rule.
"A major factor in consumer protection is the card company’s liability policies. Federal law limits consumer liability for unauthorized debit payments to $50, if the consumer reports the fraud within two business days (the cap goes up to $500 if the report is not timely [2 days!]). This means that the consumer has to pay $50-500 dollars before the card company will cover the rest. Major card companies like Visa and MasterCard have “zero liability” for unauthorized transactions, meaning that if the consumer meets the requirements, they don’t have to pay anything and are reimbursed.
However, this “zero liability” only applies to signed transactions. Every company seems to have their own policy when it comes to PIN-based transactions. MasterCard does not extend zero liability protection to PIN purchases, while other financial institutions do. For this reason, it’s important to check the policy on your debit account. Check the back of your card to find out which networks handle your transactions (ex: the Star network), and then call your bank to find out if you qualify for more than just basic federal protections."
Read this: http://banking.about.com/od/checkingaccounts/a/stolendebitcard.htm
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I give up.
If you want to create such a device, go ahead.
If you want to use such a device, go ahead.
I'm sure you will find others who think the way you do.
The effort will succeed or fail on its own merits. (I'd be betting on fail).
If you want to create such a device, go ahead.
If you want to use such a device, go ahead.
I'm sure you will find others who think the way you do.
The effort will succeed or fail on its own merits. (I'd be betting on fail).
Someone woke up on the wrong side of the bed this morning, me thinks.
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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.
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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.
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Of course I will. I have. I speak from personal experience. That is the purpose of the insurance that the banks and processing companies provide.
The "insurance" you speak of does not exist.
The only thing credit card companies and banks offer is chargeback protection.
It can only be used in the event of:
1. Straight card theft. But not when PIN number is used! Banks will NEVER give you money back when your correct PIN is used.
2. Non-receipt of goods. For mail orders, delivery of goods.
3. Broken or non-working items. If you buy something and it stops working. Time limit on this.
b. Overcharging
You aren't paying attention.
Of course I will. I have. I speak from personal experience.
I give up.
If you want to create such a device, go ahead.
If you want to use such a device, go ahead.
I'm sure you will find others who think the way you do.
The effort will succeed or fail on its own merits. (I'd be betting on fail).
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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.
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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.
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Of course I will. I have. I speak from personal experience. That is the purpose of the insurance that the banks and processing companies provide.
The "insurance" you speak of does not exist.
The only thing credit card companies and banks offer is chargeback protection.
It can only be used in the event of:
1. Straight card theft. But not when PIN number is used! Banks will
2. Non-receipt of goods. For mail orders, delivery of goods.
3. Broken or non-working items. If you buy something and it stops working. Time limit on this.
b. Overcharging
...And all this does is start the chargeback process. The merchant is given the opportunity to write a letter of explanation and provide documentation of their side.
If what you are purchasing could be better covered by a credit card for the above three things, by all means, use a credit card. For everything else, There's Bitcoin Credit Card
That said, Bitcoin credit card would not be ideal for buying goods on the internet or over the phone (duh, just do it given the tools already available), or any kind of purchase where you do not receive the goods or services right away.
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The best thing about having a BTC Card would be that you liability would be limited to however much you'd want to put on the card. You could keep a few extra bitcoin on your phone in case of emergency. Everything else can be left in your armory client at home.
Exactly!
No reason to go bananas and expect a crazy amount of security in regards to the Bitcoin Credit Card, just put as much on it as you want.
The best thing about having a BTC Card would be that you liability would be limited to however much you'd want to put on the card. You could keep a few extra bitcoin on your phone in case of emergency. Everything else can be left in your armory client at home.
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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.
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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.
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Of course I will. I have. I speak from personal experience. That is the purpose of the insurance that the banks and processing companies provide.
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.
Essentially what is being suggested is a scenario where you tell each and every merchant that you do business with where you've stored a big box filled with cash. You continuously add cash to this box as needed. The merchants then go to your box of cash and remove the amount that you've asked them to remove for payment of whatever you are purchasing. You agree not to move the box at all, and you trust (hope?) that the merchant will never use their knowledge of the location of the box to go take additional cash that you haven't authorized no matter how desperate they become.
And this is being offered as equivalent to the current credit/debit card security.
You can see how when you think about bitcoin as a currency instead of a payment network, some of the concepts start to fall apart.
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.
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
Sorry but this is the real world. If you are that paranoid just stick to cash
Then you might as well never use a debit or credit card terminal ever again. Let me know how that works out
Sorry but this is the real world. If you are that paranoid just stick to cash
Credit and Debit card terminals don't take money from you. They inform a bank about a transaction.
Accounts at the bank are generally insured (such as FDIC in the US), and under significant regulations.
If a fraudulent transaction occurs, it is the bank that looses the money (or the insurance provider).
You need to stop thinking of bitcoin as just a payment network. It is also a currency. Many of the things you think you know from your experiences with credit cards and/or debit cards simply won't apply to bitcoin due to its nature as a currency
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.
@DannyHamilton
No, the whole idea of Bitcoin is take away the middleman (the banks!) from the equation.
No banks are needed for my proposal.
Why create a centralized system for a fundamentally decentralized system. It makes no sense.
What you propose is possible, but it involves a private company basically acting as an exchange like Mt. Gox, but with the ability to communicate with terminals and POS systems and new debit cards. You are then putting all the risk with this one private company.
Hacker wipes them out, you're done. Government intervenes, you're done.
I do not want to use a credit card in a Mt. Gox-y sort of way. THAT is too risky!
No, the whole idea of Bitcoin is take away the middleman (the banks!) from the equation.
No banks are needed for my proposal.
Why create a centralized system for a fundamentally decentralized system. It makes no sense.
What you propose is possible, but it involves a private company basically acting as an exchange like Mt. Gox, but with the ability to communicate with terminals and POS systems and new debit cards. You are then putting all the risk with this one private company.
Hacker wipes them out, you're done. Government intervenes, you're done.
I do not want to use a credit card in a Mt. Gox-y sort of way. THAT is too risky!
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
Sorry but this is the real world. If you are that paranoid just stick to cash
Then you might as well never use a debit or credit card terminal ever again. Let me know how that works out
Sorry but this is the real world. If you are that paranoid just stick to cash
Credit and Debit card terminals don't take money from you. They inform a bank about a transaction.
Accounts at the bank are generally insured (such as FDIC in the US), and under significant regulations.
If a fraudulent transaction occurs, it is the bank that looses the money (or the insurance provider).
You need to stop thinking of bitcoin as just a payment network. It is also a currency. Many of the things you think you know from your experiences with credit cards and/or debit cards simply won't apply to bitcoin due to its nature as a currency
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I thought that what was being proposed was just a credit or debit card where you have a BTC denominated bank account.
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If no bank is involved, then I can see it might
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I thought that what was being proposed was just a credit or debit card where you have a BTC denominated bank account.
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If no bank is involved, then I can see it might
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Part of the problem in this conversation is that several people have put forth their own ideas about how a "bitcoin card" might work. Some of these ideas assume a "credit card" that allows you to take a bitcoin loan. Some of these ideas assume a "wallet on a card" where the private keys are stored on the card and transactions are broadcast from the terminal to make payment directly from the bitcoins associated with those private keys. Some of these ideas assume a "bitcoin bank" where the card is a way to represent your account at the bank and the bank takes care of paying the merchant and debiting your account for you.
Several people have made assumptions about what was being discussed without paying attention to the details. As such, this conversation is a bit of a mess at the moment. A big part of that confusion is probably first due to the OP's choice of words:
the credit card contains your wallet number as a credit card has a credit card number
It doesn't exactly explain if that "wallet number" is an account number representing your account at a bank, or a bitcoin address, or a bitcoin private key, or a loan authorization number.
The rest of the confusion is probably due to the OP's choice not to stick around and control the direction of the discussion correcting people who wander too far off from whatever it was that they intended.
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
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.
If a business uses anything compromised like what you are describing, the FBI and or Secret Service gets involved. (Yes, Secret Service investigates credit card fraud).
Like in this case: http://www.khq.com/story/21757307/secret-service-investigates-skimming-case-at-north-spokane-atm-crime-tracker-kalae-chock-has-tips-to-protect-your-account
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