The chip is a new version of the Japanese technology firms RFID u-chip (radio frequency identification chip), introduced in 2001.

Measuring 0.4x0.4mm, the new version has an internal antenna, enabling it to transmit its ID number to a reading device.

The new u-chip can be easily embedded into banknotes and documents to ensure their authenticity.

The European Central Bank is said to be discussing a project with Hitachi for embedding euro banknotes with RFID u-chips, in a bid to stop counterfeiters and money launderers.

A spokesman for Hitachi said the project was not being undertaken at present, as the chips first needed to be priced at a reasonable level to make them cost effective.

The original u-chip, which is the same size as the new chip, had needed an external antenna to allow devices to read its internal identification number.

The 128bit ID number is stored or burned into the chips read-only memory (ROM) at the time of manufacture, meaning it is impossible to change or rewrite the number.

One of the first applications for the new u-chip will be at Expo 2005 Aichi Japan, where it will be embedded into visitor tickets for the show, which opens on 25 March 2005.