In my previous post about this exhibition, I didn't mention the SmartLock, one of the exhibits there.
This is a conventional-looking, lightweight cable lock which contains highly pressurised liquid. When the cable is cut through, the liquid explodes (right), covering the cutter in dye and in 'smartwater', which is invisible but forensically traceable. There's a video at the SmartLock website (where the image comes from).
It's not in production yet as far as I can tell, but I'll be surprised if it really does work. The cable lock by itself offers no protection, so the careful cycle parker will still be using two heavy-duty locks anyway. The advantage of smartwater traceability will be zero: every detail of my stolen bike was registered on immobilise.com, the theft was reported within minutes, but the police simply don't spend time and resources on recovery. (I spent hours prowling Brick Lane Market, second-hand bike shops, and websites such as Gumtree that carry lots of bike ads, all to no avail.)
As to the deterrent effect of the dye, I'm about as confident in that as in Hull City's chances of staying up this season. How much would a cloth dampen the explosion? How obvious will it be that a bike's been spattered and therefore tampered with? Will a spattered bike really be unsaleable? Will thieves abandon the bike out of surprise after they and it get spattered, leaving you with a bike but a spattered one, and if so will people then assume you're riding a stolen bike?
But it's an idea worth trying, and if it eventually does get into production then we'll find out.
It's tempting to think 'why don't you put cyanide gas in there', but that would be immature and stupid. For one thing it's much too quick. Better something slow and painful, polonium maybe.
There's more anti-theft information and resources at bikeoff.org.