Point taken, but the thing is before that has any value, the recipient of the currency must actually verify that data. There is no point in conveying that info in an expensive physical coin, because such infrastructure could just as easily be fed the data by electronic means or even a printed slip of paper. The physical coin aspect of it becomes the tail wagging the dog, an overpriced way of conveying the counterfeit resistant data. If the data is not actually envisioned to be verified at time of transaction, then it's as useless as the serial number on a dollar.
If you can start with a trusted reader (A.K.A. a trusted base, the premise with *all* cryptography) then you can sign all of that data. Even if you are able to crack the verification code and feed an offline reader faulty data you would have to control what coins that person comes in contact with. Read up on how UXTO extension works to verify transactions authenticity without having the full block chain.
The only thing holding Bitcoin from exploding in many markets is a lack of a physical incarnation.
Incredibly wishful thinking there. Bitcoin has a lot more problems than lack of a physical incarnation. Being outlawed by major governments, at the mercy of speculators without any regulation, and downright vulnerable to an attack by a critical mass of mining resources working together.
That is in reference to markets with hyperinflation. The whole point is that the local government is trying to force people to use a useless currency. Compared to falling back on physical dollars, physical Bitcoins can be seamlessly transferred to a digital account and used online. It's about extending the utility of the digital version to a physical version, just as we can do with dollars and PayPal, just without the banks and regulatory policies which blockade people from third-world countries.
rural farmers in 3rd world countries are not going to get a smartphone and a $100/month data plan just so they can accept Bitcoin.
Exactly! But just a few sentences above it says:
anyone with an NFC equipped cellphone can check if a coin is counterfeit.
You've come round full circle to the problem in the first place: You need functioning internet infrastructure (and a long time) to validate a transaction in the secure way. Without that, you could counterfeit any 'bitcoin' based currency just as easily as any other currency.
They have made cheap, $10 devices which can verify PUF's.
A viable alternative currency for micro-nations and dictatorships with hyper-inflation."
Another foolish statement. Again, people are incorrectly assuming there is a technological solution to a socioeconomic problem. The failure of such currencies are a symptom, not a root cause. If it were as simple as all that, the citizens could just as easily move around some stable foreign currency. You can't do a safe, 'sneaky' end run around the force that governs a citizenry. So long as they are empowered to prosecute, shut down internet infrastructure, or just send soldiers into the street, no currency trick is going to work in the face of the fundamental problem.
No, this is not a solution to the problem as a whole. However, in your words, it makes end-run arounds the forces that govern the local citizenry a hell of a lot easier and safer. This helps to weaken the power of a central government to force the citizens to use a currency which they have manipulated and thus weakens the power of such a government to manipulate their currencies to begin with.