The idea here is to build a centralized database that is simply a record of publicly signed bitcoin addresses. A trusted address can then be accepted by merchants as a zero-confirmation payment source.

Here's how I imagine it works.

For the bitcoin address owner

Take your private SSL key (granted to you by a company like Verisign) and use it to sign bitcoin addresses. Publish the bitcoin address as well as the signature to a the centralized database.

For merchants

When receiving a payment to a certain address, look up the Payee's bitcoin (from) address in the database. See if the signature on that address comes from a source that you trust and verify that signature with the source's public key. If the signature verification succeeds, accept payment with 0-confirmations, otherwise fall back on 1 or more confirmations.

Example

JohnDoe has an online wallet at WalletCompany. JohnDoe decides he wants to buy some donuts at BitBakery, so he asks BitBakery for the payment address. JohnDoe logs in to WalletCompany and goes to the 'send bitcoins' tab. He enters 0.5 BTC and the payment address. WalletCompany, before firing off the bitcoin transaction first takes the bitcoin address that the bitcoins belong to (before being sent) and uses the SSL private key and certificate for their website (https://walletcompany.com) to sign the bitcoin address. The (bitcoin address, signature) pair is posted to BitcoinSingatureDatabase.com's RESTful API. WalletCompany then fires off the transaction to the bitcoin network.

Upon BitBakery receiving the transaction, he immediately looks at the source bitcoin address and queries BitcoinSignatureDatabase.com for the signature that matches with the address. Since BitBakery has added the SSL public key from WalletCompany.com to their 'trusted entities' list, BitBakery can quickly verify the signature on the bitcoin address matches the public key for WalletCompany. BitBakery then accepts the transaction as virtually confirmed, since he knows WalletCompany is trustworthy.

So does all that make sense? What do you guys think? Please SMT.