Coin: A startup poised to transform your wallet

(MoneyWatch) If the future of money is virtual and digital, does electronic wallet startup Coin represent the currency of tomorrow?

Coin made a splash last week by opening its universal credit card to pre-order. On the surface, it's an impressive product. Imagine an electronic device that's the same size as a traditional credit card, but it can hold up to eight credit cards, debit cards and gift cards. When you want to make a purchase, you can easily choose the desired card using a simple control on the surface of the Coin. Coin is accepted and scanned like any ordinary card, and you can even swipe it at an ATM or point of sale card reader.

While the Coin gadget only holds eight cards at a time, it syncs with an iPhone or Android app where you can store an unlimited number of cards, and can swap them around anytime you like. The Coin comes with a Square-like credit card reader for transferring your card info to the phone and then onto Coin.

The possibilities are exciting. Who wouldn't like to leave all of their various cards at home and only carry a single card in their wallet? But the jury is still out on Coin's viability. For starters, it's not shipping until summer 2014 at the earliest. Seeking $50,000 in capital, Coin is taking pre-orders now (and charging your credit card) to the tune of $50 for a device that you'll get next year, at which time the price will jump to $100 for latecomers. 

Assuming it comes to market, meanwhile, Coin will face major challenges. For instance, the electronic card doesn't display the signature field on the back of the original card, so there's no way for retailers to check a user's signature. More fundamentally, many retailers want to a shopper's original card, and Coin is not that. 

Despite such hurdles, Coin has thought through security concerns. The device pairs with your smartphone, and you can specify a time-out period after which the card will stop working if it's out of contact with your phone. In a nice touch, it will even ping your phone if you walk away from the retailer without taking Coin with you.

Coin's battery is supposed to last two years, after which you need to replace the device entirely, so factor that into the equation as well. Still, if Coin proves viable, this could be a bold move toward that virtual currency future we've been waiting for.

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