How do you plan to eliminate violence in prisons? Before stealing the money, now they steal the private keys of any goods that become prisoners.
First of all, the wallets will be stored on kiosk that will be networked with each-other. The inmates private key will be backed up to each prisons private network with a backup to a remote offsite server. Remember, in the prison system, things have to be done a bit different.
This will not stop the violence in prison, but it can help reduce it buy putting the true value into the coins and not things that can be stolen from inmates cells on a daily basis that they use for currency.