Bitcoin needs a physical merchant payment system. An ambient backscatter type device could provide a truly elegant solution, to what is a mildly complex problem. A solution of that quality may be several years or more away.
This device will require some computing power. To maintain security transactions must be signed on a device carried by the user. This could look something like Trezor, but I’d prefer it to look and feel more like coin.
Regardless of the form factor there should be a “2-touch” process, where the users’ device receives transaction details from the merchants gateway, the user is then allowed to approve or deny the transaction. A second connection is made when the users device transmits the signed transaction to the merchants gateway for broadcasting over the network.
While this process could be adapted to use smart phones the additional security risks outweigh the rewards. I personally would not hold more than a few hundred dollars worth of bitcoin on a cellphone, and mine is always locked, encrypted and set to “self destruct”.
While first to market may not be the winner here, a step in this direction is required for the cryptocurrency economy to become a viable alternative.