The problem with microchipping is that it only works if the people with the readers know where the chip is. It wouldn't take long before the thieves worked that out too.

The most unexpected use of microchipping I've seen was an ambulance crew assisting a blind man who'd collapsed in the street. They were using a chip reader on his guide dog's ear to identify him. The mind boggles that this was a common enough event that they'd be prepared for it.

I can think of quite a few folkies who might be easier to identify by a chip in their flute or fiddle than by anything they'd be in any condition to say when coming home after a gig.