When you first put it on you will be required to unlock it, using either a passcode or your iPhone. It will stay unlocked until it senses that it has been removed from your skin.
When locked, there are options to wipe it after so many incorrect attempts at unlocking.
Obviously there's no Find My Watch functionality since it must be connected to your phone for Internet and gps.
Thanks, so if off wrist/not in skin contact is it 'locked'?
You're more likely to get your car stolen than being mugged for your phone.
https://www.lookout.com/resources/reports/phone-theft-in-america
http://www.rmiia.org/auto/auto_theft/statistics.asp
310,000 phones were stolen off a person's body in the US in 2013.
699,000 cars were stolen in the US in 2013.
... For Apple Pay you are only vulnerable for a day until it needs to be paired again....
So when I see someone wearing the $17k version, I'll be sure to chop their arm off so that the watch stays unlocked.
OK, Apple Pay is disabled when you remove the device so you don't have a day of exposure. But what keeps someone from pairing it with their own phone? What feature (such as those now being required on phones) makes the watch unusable on another phone?