Smartcard wallets for small transactions have been tried ages ago and failed, like this:

http://en.wikipedia.org/wiki/Proton_(bank_card)

Having used this myself, the problems were numerous. First of all, it's effectively a new currency, so you have to explicitly convert your cash money into this form. This sucks. But because it's meant for small purchases, you'll only ever have pocket change on there, which means your balance runs out all the time. The card doesn't display its value, so you risk looking like an idiot and pissing off every customer behind you when they see you tried to pay the 'fancy way' and failed.

Of course, today things are different, and the web is hugely important, and most of us carry smartphones. But do you really want your ability to use money to be tied to your phone's flakey battery?

Yeah, I agree with this statement. The title comparing MintChip to BitCoin is probably somewhat misleading. MintChip won't provide the decentralized currency system that BitCoin does, but as an alternative to credit cards, it does seem very appealing!