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In the United States credit cards with electronic "chips" are being rolled out.
My impression is that the idea is prevent skimming, the practice of waiters and other card handlers to secretly swipe a card and sell the information on the magnetic stripe to a third party. Also, skimmers can be installed in things like gas pumps. Every time a customer uses their card in the machine, the skimmer records the info off the magnetic stripe.
Do chips prevent this, or are chips just as readable by skimmers as magnetic stripes?