I was just wondering about the same. The benefits for Smart Cards (preferably USB-dongles), is that it is actually a x509 or PKCS#12 certificate on them.
This means that one can use encryption as security.
Usecases for Smart Cards:
SSH
OpenVPN or StrongSwan
Encryption of harddrive
SSL client certificate for web-browsing
The dongles also lock them selfes up if I type the wrong pin too many times.
The dongles also lock them selfes up if I type the wrong pin too many times.
I am using ePass2003 and cryptoStick. They work ok, but they are a bit slow.
When I run: time ssh localhost true
It takes 1 second with with ePass2003 or cryptoStick. But with a key on disk (and ssh-agent), it takes I wonder if anyone know of a faster USB-token.