Probably not.  Just because 200K BTC trades ON the MtGox exchange (which has nothing to do with the blockchain) doesn't mean an attacker could profit from all that.

So an attacker has a large number of BTC.  He deposits it on MtGox and then starts building an "attack chain" in secret.  Even if he converted the 200K into $2M he can't withdraw that in a day.  Tier 3 verification (requires requires an apostle seal from your state govt for US residents) is still limited to $100K per day ($500K per month).  So an attacker "could" in theory profit $500K in 5 days.  Of course that ignores the effect of an additional 50K BTC in selling pressure driving down the price.

However in 5 days an honest miner could generate $225,000.  So the ratio between good and bad is much smaller.  Also the only way you are moving $500K in 5 days is by bank wire which is going to leave a trail.  So $225K honestly or $500K + $225K = $725K and risk of going to prison?  Factor in some delays by MtGox on wires and it may require more like 10 days to ensure you have sufficient funds which makes the attack more like $450K honestly or $950K + prison.  Worse say there is a mixup or an AML/KYC hold by one of the banks for 15 days.  Ouch more and more hashing power just to get this "easy" $500K.

Of course even if successful you are now a wanted man and likely wouldn't get more than one attack.  Next month if you tried again (even with a new account) MtGox likely would have lower limits or more stiff validation so it is a low return of then $20M or so you spent on hardware.  Plus nobody is going to run a 10TH/s farm by themselves you are talking an entire crew (admin, technical, electricians, security - you weren't going to leave $20M unguarded in some warehouse were you).  Seems a pittifully small "score" divided 5? 10? ways to risk prison. 

Much easier to just offer 7% returns and have people hand you 10x as much with no strings attached.

Satoshi designed it well.  The economic disincentive for doing the wrong thing makes it very unlikely there will ever be an economically viable 51% attack.  The only real threat is a non-economic 51% attack (where the attacker sees the attack as simply an unrecoverable cost to destroy Bitcoin).

Yes.  No.  Maybe.  Both.  Neither.

Game theory time:
If someone actually could predict the market it would be in their best interest to not tell you (trading is a zero sum game).
If someone can't predict the market it would be in their best interest to lie and have you become the counterparty for their trade (allow them to sell for more or buy for less).

Why the double standard against dank?  Many PPT offered "insured" payouts.  SHOCKING REVALATION: they weren't insured.  

Now I am not endorsing dank I just think it is funny this is the first time people realize that "insured" in HYIP doesn't really mean anything.  It never has.  Not a single "insured" offering on this forum has any insurance.

Hell I personally signed as a guarantor for my company debt as it offers less risk for lenders.  The can collect from the company, a registered LLC or from me personally, which is far better "insurance" than anything offered by an "insured" borrower.  However I didn't call it insurance because it isn't insurance.  It is a guarantor nothing more. 

So miners can mine empty blocks and get paid extra for it?

The proposal seems overly complex.  Setting a minimum mandatory fee equal to 0.000005 BTC per byte enforced by the protocol would have the same effect while not rewarding miners for doing less work.

As time goes on I am less convinced that a Tragedy of Commons even exists.   While it is true that block rewards could be driven towards zero it is also true that for some tx the fee (and high assurance of inclusion in the next block) has higher utility than free or nearly free tx.

There are also alternative models.  If Bitcoin fails due to insufficient security then everyone loses.  Large stakeholders lose the most.   I could see a scenario where MtGox provides hashing power to the network.  They could provide it directly or they could simply create a pool and pay miners a fee per GH/s to include all tx.  Since MtGox shareholder equity is directly related to the utility of Bitcoin it is a reasonable expense.

You could also see scenarios where companies which need fast processing (like our company) could pay a pool a flat monthly fee, provide the pool a list of addresses, and the pool gives tx to those addresses highest priority even without a fee included by the sender.  Our company directly benefits from fast confirmations (as it reduces our variance risk/cost) so it is potentially profitable to pay for it.

Bitcoin 2 is the most efficient cryptocurrency ever.  The lower your hashing power the faster you solve blocks. 

You do realize that:
The payout address is part of the coinbase tx?
The coinbase tx is part of the merkle tree?
The merkle tree produces the merkle root?
The merkle root is one of the 6 components in the block header?
The specific block header is what is hashed and compared against the target?

Thus the found block hash is only valid for that EXACT block.  Change any element of the block (like say the payout address) by even a single bit and the found block hash no longer "solves" the modified block.

TL/DR:
You didn't honestly think nobody thought of this till now right?  I mean 4 years of mining and nobody, not a single miner said.  Hey why give it to the pool when I can keep 50 BTC for me?  If you could do this pools could do it to each other too.  DeepBit takes every other miners blocks changes the reward address to their reward address and claims credit.   Of course if you could change the coinbase you could change any tx so double spends would be trivially easy and the proof of work would be proof of absolutely nothing.

There is no "leading up to a block".  Each hash is unique and independent.  Like a lottery ticket.  The hash/ticket is either a winner (solves a block) or it isn't (worthless and thus doesn't improve the odds of any other hash).

Most central banks don't profit directly.  The Fed (US) for example turns over all trading profits to the treasury (beyond their allowance for rebuilding reserves and operating costs).  Now the Fed clients (major banks) most certainly benefit indirectly from the actions of the Fed.

The more important thing is the Fed's actions are intended to create a trading profit (as the OP outlined).  The fed isn't saying "ok how many T-bills do we need to buy in order to make a 5% return this year".  The Fed is saying "ok how much liquidity do we need to add buy buying T-bill and increasing the money supply to meet our target inflation rate".  IF the Fed shows a trading profit is immaterial.  Sometimes it does.  Sometimes it doesn't.  It isn't trying to profit from open market transactions.  That is the problem of the OP scenario.  A non-central bank WOULD have to make a profit.  You can't peg a currency AND profit.  You may profit while pegging a currency but you may also lose.  The fed doesn't really care.  A decentralized bitcoin bank which sometimes suffers massive losses for the "good of everyone" isn't going to have many investors.

Now let me be clear I am not saying the Fed is "good".  Power corrupt.  The Fed has a lot of power and is beholden to the banking cartel.  Currency is a zero sum game so when the banks win someone else loses.  I am just saying it isn't the INTENT of the Fed to show a trading profit.  They trade to control the "market" (in this case the market is inflation & interest rates).

You either have a bot who's intent is to make a profit and it doesn't care if the prices goes to $0.01 or $100 or you make a bot which strives to keep the price trading in a narrow range and doesn't care how much it costs to do that.

You can't have both not without infinite reserves.  Decentralization doesn't change that fundamental equation.  Now in the short run you can make a bot which does both .... until you deplete your reserves end up long on the wrong side and see a massive massive move against you.  Central banks can peg a currency simply because they can't run out of funds, a entity without the ability to create or destroy currency at will can.  The longer you kept the market from reaching a natural equilibrium the more of a momentum play you will create and when you lose control speculators pile in to "ride the rocket" (or the reverse).  

So yes you can hold prices steady & yes you can profit from market.  No you can't keep prices steady AND profit from the market.

No.

Simple version.  Central banks can't fail.  They can generate infinite reserves and destroy infinite amounts of currency in order to manipulate the exchange rate.  While they may make a "profit" it isn't their intent to do so and just as often they lose money in these transactions.   Trying to keep prices level AND profit is going to fail on both accounts.

For example the Chinese central bank pegs the Yuan to the dollar at a certain exchange rate.  How do they keep it there?  Simple if it rises (relative to the dollar) they generate a much currency as necessary and buy dollars thus removing dollars from the market (relative to Yuan) and adding Yuan (relative to the dollar) which lowers the exchange.

There is nothing which prevents someone from buying Yuan above the exchange rate set by the state other than the "threat" that you are taking a bet where the opposite side of that bet is taken by the central bank.  A central bank with infinite fiat resources, who has no profit motive, and who can continue to take losses until they win.  The WILL win and you WILL lose.  People tend not to take bets they can't possible win and that "threat" keeps the exchange rate trading in a narrow band.

TL/DR version
Cental banks need two things, neither of which exist in the Bitcoin world:
a) infinite supply of currency they can generate from nothing
b) ability to operate infinitely without profit (their losses subsidized by taxpayers and/or currency holders)

While a "non-central" bank COULD try to limit the rise of Bitcoin (or limit its decline) eventually no matter how large it will find its reserves insufficient and then all that pent up demand will cause a massive spike/crash and the "bank" will suffer crippling losses.  

In order to merge mine the primary chain and the alt chains need to have the same hashing algorithm.  If Bitcoin were to change to a new algorithm it could no longer be merge mined with SHA-2 chains.  We likely will be using SHA-2 for some time.  Nobody can predict the future but SHA-2 is well researched and cryptologists have spent a lot of effort looking for flaws.   If a flaw is found in SHA-2 25 years from now and Bitcoin moved to SHA-5 2 years after that it doesn't really matter.  All current GPU and ASICS will be long obsolete anyways.

Most tx don't pay a fee (and probably some of those paying a fee, don't have to pay a fee), just take a look at the blockchain.  Not sure where you get the idea it is a rare thing.  The rules for mandatory fees (which are not intended for revenue and exist solely to protect the network from denial of service and spam attacks) can be found here:
https://en.bitcoin.it/wiki/Transaction_fees

If a tx is high priority it doesn't have to pay a fee.  The link has the exact formula but a rule of thumb is "one bitcoin day".  If the input(s) for a tx are 1 bitcoin day (i.e. 1 bitcoin received 1 day ago) or larger then the tx is 'high priority' and no fee is required.  

Note: the determination for priority is based on INPUT not OUTPUT.   You can pay 0.01 BTC with an input that is 1 bitcoin day old and still be considered high priority and thus no fee required.

The "merged" part of merge mining is done in the "miner" (software).   For the case of mining pools it is the pool server which generates the getworks (and constructions the block header to be compatible with both chains).

At the hardware level the hardware is simply hashing a number.  It  has no concept of what that number represents and thus there is no obstacle to merge mining.

Does anyone think it is unwise doing business with a self described vagabond.  Saitekman12345 gave a homeless man $250 (almost a month's income) and is surprised when he walked away with it.

REP OR ESCROW.
REP OR ESCROW.
REP OR ESCROW.

There are no required fees in Bitcoin except for low priority tx and those which violate the anti-spam rules.*  You can send relatively small amounts as long as the inputs have sufficient age to be considered high priority.  


* Technically these aren't part of the protocol and only imposed by the client however since almost all pools and nodes follow these rules creating tx which don't follow them even if possible can result coins delays days or even weeks until someone mines them.

Alternatively take a cash advance against your credit/debit card at any Bank of America or Wells Fargo location and then deposit the cash using BitcoinsDirect.

That is my understand as well just remember hedging simply transfers the volatility risk to someone else (in this case the site operator and/or backers providing the hedging).  If volatility increases the risk increases and either they are forced to stop offering it or charging more.   No matter who is doing the hedging volatility costs users who are using Bitcoin as a payment mechanism.  More volatility = higher costs and lower value/utility.

That quote refers to multi-sig implementation where one of the two private keys are on a second device (like say mobile phone).  Compromise of funds would require finding and compromising two independent devices.  It would raise the bar significantly.

There is no probably about it.  You deposit BTC, they sell them and put the funds on your card.  So it isn't a giant BTC sink which will cause the value to skyrocket.  

Now there is always friction in any financial transaction.   Take SR for example.   If their volume doubles would the price of BTC rise?  Everything else being equal?  Yes.  Why?  There is a lag (friction) in the double conversion.  Customer buys BTC, customer sends BTC to SR, SR sells BTC.  The process isn't instananeous.  Thus some amount of BTC are required to float that cycle.  If the volume increases the amount of float increases and those coins become unavailable for other purposes.  Totally out of my ass example numbers to illustrate the effect.  SR does 100,000 BTC worth of tx per month.  The time from USD -> BTC -> USD is roughly 3 days.  That means ~10,000 BTC are "unavailable" for other purposes.  Less supply, more demand, price rises.

BitInstant offering will likely have a similar (although probably smaller) effect.  A miner may hold BTC longer simply because he can sell if/when he needs funds.  Any merchant or service (even those selling back to USD) creates the same effect.  Hopefully someday thousands or merchants and service providers and millions of years create enough demand for "float" that prices are higher and more stable.

Well you don't have 1,000 BTC in one address.  That is an abstraction.

Bitcoin works on the concept on inputs and outputs.

If I send you 1BTC that is a 1 BTC unspent output.  

So your 1,000 BTC address could consists of a single 1,000 BTC unspent output or it could consist of 10,000 unspent outputs worth on average 0.1 BTC each.  Also you can't spend only 1 BTC of a single 1,000 BTC input.  If an tx inputs are 1,000 BTC the tx outputs must be ~1,000 BTC.  The difference between input and output is the fee to miner.   So if the 1,000 BTC address consisted of a single 1,000 unspent output the tx would have 1x1000BTC input and two outputs (1 BTC "spend", 999 BTC "change") totaling 1,000 BTC.

The size of the tx is based on the number of inputs and outputs.  There is no correlation between size and value.  You could have a 1M BTC tx which is <1KB and have a 0.00001 tx which is dozens or even hundreds of KBs.

A two input and two output tx is roughly 1 KB.  The average tx has ~4 combined inputs and outputs.

You honestly think that less than 1% of Bitcoin users are involved in the SR?   Really?  bitcointalk.org =/= bitcoin.   Hardcore destroy the FED, bitcoin is going to $538,942,343,243.28 in 2 years when it becomes the one world currency =/= all bitcoin users.

Some people actually just use Bitcoin to buy and sell things.  Crazy I know people using a currency for commerce.  The SR is the largest source of commerce involving BTC.