Share this post: LinkedIn Email WhatsApp

The idea

The BitCoin has made great strides since it was first created, but before it can begin to compete with “real-world” currencies it has to make the jump to our physical wallets. This project aims to do just that: allow you to use the BitCoin in everyday life as you would your local currency.

The BitCoin Debit Card will, in practice, function just like any other debit card: swipe, type your pin and get a receipt. BitCoins will then be automatically transfered from your BitCoin wallet to the vendor’s.

I’m lost… what is BitCoin??!

For those of you uninitiated to the BitCoin, here is a short video that should help clear things up:

Comment on the features you want to see. We promise we will try to use as many of your ideas as possible!

Shape the future of retail

If you can’t support financially, please at least help us get noticed by digging and liking us on FaceBook, following us on Twitter Also, join the conversation that has sparked on reddit! Send feedback/questions/comments/ideas to us at BitDeBit@gmail.com

You can also support us by registering at BitCoin Bonus via this link. (use a fake email if you’re at all worried) You will receive 0.005 Bitcoins as a thank you! This is one of the best ways to support us since you will not lose anything but 2 minutes of time.

Another way you can help support our project is by donating prizes. If you are a business, we will distribute your prize to the appropriate donation bracket (or have a draw). This is a great way to promote your business and get connected to BitCoin users.

How will it all work?

Security

Security if our primary concern in this project. Security will be insured by storing a private key (we suggest not to use this as your main one) on a secure server (not on the card itself). Swiping the card and typing your pin will be used to authenticate your account. Once authenticated, the server will generate a random address and transfer your funds there before transmitting them to the vendor. The randomly generated address will be immediately destroyed after use. Coins can also be automatically forwarded to an offsite wallet to ensure greater security. We suggest your BitDeBit account be used only to store the coins you need for upcoming transactions and the rest be kept offsite, this way nobody can steal your money and you can still make BitDeBit transactions.

Flexibility

For vendors, we will develop payment processing machines that can either be connected through their business computer (to interface with their accounting software) or even directly to the internet. This will allow small businesses to accept payments at minimal cost (no credit card fees, no need to buy a computer).

Anonymity

We aim to create a system that will keep as many of the great features of BitCoin on the web. One of those is anonymity. We have designed a system in which users can retain complete anonymity while using our services. However, some extra features cannot be activated unless we have some personal information such as buyer/seller protection, password recovery, etc.

Enough theory: how it works in practice

This is still in the refining phase. If you see any major (or minor) areas that could be improved or features that you would like to see added, please send us your ideas by commenting on this page or sending us an email! As of now we envision up to 3 different solutions based on clients needs. Note that there is nothing stopping a client (in fact we would encourage it) from using 2 or all of these depending on the situation.

Concept service 1: the average user

Pros:

– Anonymous (if you don’t take advantage of all the features)

– Instant payments (no need to wait 10 minutes for confirmation from the block)

– Secure

Cons:

– You must trust the server

– Vendors must trust the server when it says you have enough to pay

Example: Bob has a BitCoin wallet with 100 BTC. He needs to make 5 BTC worth of purchases today. He goes to the BitDeBit website and decides to sign up for an account. He is prompted for the desired username, password and optionally an email address (for password recovery). He chooses a username (bob2000) and a password (12345). Now he is given an account with an address to which he can send BTC. since he needs 5 BTC for today’s purchases, he takes 5 BTC from his main wallet and sends it to his account.

Now he needs a card. Bob wants to be anonymous, so instead of choosing to purchase a card online, he decides to get one from a local retailer. Once he has his card, he goes back to his account and removes the holographic sticker from the back of the card, revealing the card’s ID number. He types the ID number in the correct field on his account. His account and card are now linked. Now he’s ready to go! Bob goes to do his groceries. At the cash, he swipes his card, accepts the cost and types his password.

This information is sent to the BitDebit server under heavy encryption. When it arrives, the server checks that Bob really can spend 5 BTC. His account balance is 5 BTC, so the server returns a confirmation to the vendor that the money is indeed available. The money is then transferred to the vendor’s account after first having been funneled through a spoof account that is then destroyed. This way Bob’s main address is not known to the vendor and bob can remain anonymous. The vendor can now give Bob his groceries confident that the BTC will be transferred within the next ten minutes since BitDebit confirmed Bob had the money.

Now Bob is feeling a little bit evil today since he knows transaction processing can take a while, he quickly grabs some more food and goes to another cash. The person swipes the card, he types his password, the info is sent to the server… but when the server checks to see if Bob really has any money to spend it remembers that he just spent all his money. It sends an error message back to the cash, the transaction is canceled and Bob cannot complete his evil plan. At the end of the day, Bob returns home and adds another 3 BTC to his account for tomorrow’s purchases, confident that the rest of his money (92 BTC to be exact) remains safely in his private offsite account.

Concept service 2: The business user or protected buyer

Pros:

– Buyer/Seller protection

– A record of transaction useful for accounting/taxes, etc.

– Adds more trust between both parties because they know who they are dealing with

Cons

– Loss of anonymity

– Not all funds will be available immediately

Roger wants to buy a computer, but the company he wants to buy from is a small startup that seems kind of shady. They say they are offering a 30 day guarantee, but he knows that if he purchases the computer using concept service 1, the transfer will be untraceable and he will never be able to prove he bought the computer in the first place. For peace of mind, he decides to get an account with protection features. For this he must be over 18 and provide personal information such as name, phone number, address, email, etc. and verify it by phone. Once he has his account set up, he can purchase the computer with peace of mind knowing that if ever he has a problem within the guarantee period he can prove that he purchased the computer thanks to the paper trail generate on his account and store on the BitDeBit servers. To be extra safe, he downloads a copy of the paper trail unto his personal computer using the one click backup feature. Roger now loads the 50 BTC he needs to purchase his computer with into his BitDeBit account and confidently buys the computer. 2 days after he purchased it, however, it breaks down and smoke comes out of the casing. Roger rushes back to the store where he purchased it demanding a refund. The shady techno people deny he ever purchased the product, so he shows them the papers he printed proving that he did indeed purchase it and has a guarantee. They continue to ignore him. Roger goes home and contacts BitDeBit who then investigates the case and determines that Roger was cheated out of his money. Because the transfer happened less than a week ago, BitDebit retains the right to transfer the money back to the buyer should something like this happen. The money is promptly transfered back to Roger. Happy, but still computer-less, Roger decides to buy a computer at another shady joint. This one seems to be working well until 29 days later when he sees another cloud of smoke begin to form. When he goes to get his computer fixed under the 30 day guarantee, they tell him it was actually only a 20 day guarantee and he isn’t covered. He goes home and calls BitDeBit. BitDeBit investigates and confirms through the paper trail that he did indeed purchase a 30 day guarantee. However, since the funds were transfered more than a week ago they cannot directly transfer the funds back. Instead, the vendor’s account is frozen until the problem is resolved. Because Roger has all the paperwork, he is able to take the shady computer company to court and win his case.

Concept service 3: the anon

Pros:

– Totally anonymous

– Decentralized

Cons:

– Unprotected

– 10 minute waiting time

– High risk of fraud and copying

– Higher costs

Betty is an anarchist and won’t trust any organisation with her BitCoins. Instead, she decides to purchase a smart card and load her entire .dat file unto it. She then goes to the store to purchase things. Instead of swiping a card, she plugs her smart card into the vendor’s machine and types her password. The money is transfered directly from the account on the .dat file. The vendor must now wait 10 minutes to receive confirmation the Betty really did transfer the money. Once the block goes through, the vendor hands Betty her now cold coffee. Betty is happy in knowing that she is cool because she didn’t give in to centralization. She didn’t even have to purchase the smart card from BitDeBit since anyone can purchase a smart card and put their .dat file on it. The vendor however decided to grab a copy of her .dat file himself after she had typed her password in and now he can steal all her coins whenever he wants. Betty looses all her money. Having now learned better, she decides to purchase a whole bunch of smart cards and make different .dat files for each one with different amounts. She labels each card accordingly and only uses each one once. She therefore is totally secure and manages to stay off the grid, but has to pay quite a bit extra to buy all those smart cards.

And now the 5000$ question

Why 5000$? Some might think it’s not enough, others too much. I believe this should be enough to get the project started. You have to count the cost for the conceptualization and printing of hundreds (maybe thousands) of test cards which will each cost up to 1$. You then have to consider the equipment that will have to be purchased and programmed to create the prototype and final vendor units (costs should rise above 5000$). Next you must consider web server space and hosting costs and the cost of developing strong and secure server software (should be another 3000-5000$ to get started). Clearly the startup cost will exceed 5000$, however I think we can make a lot of good progress using only 5000$. Once the project is started, it will be easier to gain the additional support we will need to continue.

Comment on the features you want to see. We promise we will try to use as many of your ideas as possible!