The banking system took the easy way out at every step of the process that lead to our current electronic money system. No surprises there, banks are immoral corporations. The emergent system is utterly insecure. Again, no surprises, people have been saying that the credit card system is totally compromised for years.
So, we have to look at the root causes of this insecure emergent system:
1. Almost completely unencrypted. The USA's (also possibly emergent) policy on cryptography is to keep it out of general use. Clearly, the NSA knew enough about cryptography in the 70s and 80s that they could have guided the US banking system in a more secure direction. But they didn't, apparently for fear of giving away secrets. Or something.
2. Letting corporations develop de facto electronic money. Crappy security is just one aspect of this problem, others are ridiculously high interest rates, and the fact that it's cheaper for corporations to take checks than than to take credit card payments, as the US Fededral Government runs the check clearing houses for free or almost free.
So, we have to look at the root causes of this insecure emergent system:
1. Almost completely unencrypted. The USA's (also possibly emergent) policy on cryptography is to keep it out of general use. Clearly, the NSA knew enough about cryptography in the 70s and 80s that they could have guided the US banking system in a more secure direction. But they didn't, apparently for fear of giving away secrets. Or something.
2. Letting corporations develop de facto electronic money. Crappy security is just one aspect of this problem, others are ridiculously high interest rates, and the fact that it's cheaper for corporations to take checks than than to take credit card payments, as the US Fededral Government runs the check clearing houses for free or almost free.