True, I was thinking about this last night and the best solution would seem to be built in PIN like the debit cards used in Europe and Canada.
"Chip debit cards encrypt all information stored on them, increasing your safety when completing a transaction."
This will prevent merchant from having ALL your info just on the magstripe.
"Chip debit cards encrypt all information stored on them, increasing your safety when completing a transaction."
This will prevent merchant from having ALL your info just on the magstripe.
I still don't understand how this will work. The merchant can't move the bitcoins from your address unless they have your unencrypted private key. Once they have your unencrypted private key, there is nothing that prevents them from saving it and re-using it in the future.
It seems that what is needed is a card that has a processor, display, and input interface built into it, the card would be placed with some sort of electrical contacts interfacing with the merchant's terminal. The terminal would request the bitcoin addresses known by the card. The terminal would then search the blockchain for unspent outputs associated with those addresses. The terminal would build an unsigned transaction and submit the transaction to the card requesting a signature. The card would then display the transaction amount on its built in display. The card owner would verify that the displayed amount was correct, and would use the card's built in input interface to indicate acceptance. The card would reply to the terminal with a signed transaction. The terminal would then broadcast the transaction to the bitcoin network.
Patience, my son.
That's what the chip debit card is for.
Once you insert your card in the terminal, the terminal prompts the customer for their PIN number. The customer inserts their PIN number into the terminal. Since all terminals are PCI compliant nowadays, the inputted PIN is encrypted and cannot be recorded by the merchant or anyone else. This is all done now with Canadian and European debit cards, this is not just theory.
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.
I worked for many years in the credit card processing industry, so I know about these things. To be honest, I'm surprised this hasn't already been done. If people want to join together to do this, let's go for it
