There are two reasons why chip technologies are just bad ideas, and I'll take this from the weaker reason to the stronger reason.
The weaker reason is in the encryption and in the CPUs that can be used in a device the size and shape of a credit card. For real security, you need at least an order of magnitude more total computing capability than you can fit in a credit card with any technology that can be specified today and physically implemented within the next ten years.
At least one order of magnitude, given known vulnerabilities in the encryption schemes.
(If I say more than that, some idiot will tell you I have to be speculating about vulnerabilities that will never be discovered, and I don't want to argue with idiots, so I'll keep it at a level that you can verify for yourself, if you are willing.)
There simply is not enough computing power available in a credit card.
You can't make the processors fast enough without the CPU burning a hole in the card.
And you couldn't power such a fast processor with a battery that would safely fit in a card.
Barring some serious advances through fundamental technology changes, the barriers in the actual physics of the devices basically prevent it from ever working. Current semiconductors just can't do it.
The stronger reason is the one about the no clothes. Some would say this is not a technological barrier, but it's still a barrier.
You cannot observe what happens in the transaction without special devices.
This is the fundamental reason internet voting is a bad idea, and that electronics do not belong in the voting booth.
It is the whole reason that the chips in your passport are a basic invasion of your privacy.
You can't see what is happening.
You don't believe me? Prove that you can see what is in your passport or credit card.
Prove that you can observe it when the credit card gives your signature to the card reader.
If you can, you have access to a certain class of device that ordinary people do not, and that can be regulated so that ordinary people could not legally have access to them.
We could imagine a world in which everyone has the equivalent of Google's glasses surgically implanted in their eyeballs, and the equivalent of a wardriver's rig embedded in their skulls, and that would allow people who cared to take the trouble to make the transactions visible to themselves.
But they would still be relying on electronics and software that someone else engineered. No single person could build the complete package all by himself, and therefore he would have to rely on someone else who could betray that trust.
("... build it all by herself"? Pardon me if I chuckle. Women regularly build such complex devices, but we call those devices "babies", and we do not claim that women understand all the technical ins and outs of those babies. And it's the understanding that is the problem and the answer here. Man or woman, it requires trusting someone whom you had better not be thinking is your God.
Babies, on the other hand, were designed by the only entity/process we dare rely on so implicitly. Dare? Well, we have no choice but to rely on that entity/process, whatever we call It/Him/Her. That is, to the extent we choose to not rely on It/Him/Her, we only destroy ourselves.
And that It/Him/Her seems really not to care much about our ability to claim we own a lot of something that nominally represents value in an artificial economic system.)
Actually, this is not a technological barrier. It's a barrier that goes a little beyond technology.
[JMR201702281021:
Mind you, I'm not saying we shouldn't use the chips. (Except in passports. That was a no-no.)
We just shouldn't advertise them for something they are not.
They are just a very unsecure addition to a financial transaction system that was fundamentally unsecure from the outset.
Here's how we should advertise them:
Credit Cards
a very convenient way to allow someone to take your money!
and
Chip Cards
an even more convenient way to allow someone
to even more conveniently take your money!
I'm not calling for panic here.
Money is not all that valuable, anyway.
]
