X3's don't have a key slot, but they do have a marked location (on the steering column) to hold the key near, as a back-up for starting the car if the normal keyless system fails, or if the battery in the wireless key is dead.
The key uses a battery that will eventually need to be replaced. It is not recharged in the car. The electronic key is in two-way communication with the car's computer and not only stores individual user preferences for seats, iDrive settings and phone directories, but also stores car maintenance info. You can bring your key to a dealership, and they will know the car's mileage, the estimated date for the next required service, and any major problem faults.
The key may also "know" your driving history, bank account balance and the websites you frequent on the Internet, but I'm not sure about those last three.
