These types of devices might provide a better user experience for customers as they free the purchaser from having to use a secure password.
This additional security authentication is based on a three-domain model hence the 3-D in the name itself.
Supporting 3-D Secure is complicated and, at times, creates transaction failures.
A patented system called iSignthis splits the agreed transaction amount into two or more random amounts, with the cardholder then proving that they are the owner of the account by confirming the amounts on their statement.
This will typically take them to a form in which they are expected to confirm their identity by answering which should be known to their card issuer.
Since the merchant does not know this password and is not responsible for capturing it, it can be used by the card issuer as evidence that the purchaser is indeed their cardholder.