Stake does not equal exposure:

Consider for example a pirateat40 style "trust" on a POS coin. The "trust" has a very significant stake combined with a very significant short exposure, and consequently a vested interest in the collapse of the currency, and can vote the stake accordingly. https://en.bitcoin.it/wiki/Pirateat40. POS rewards the creators of ponzi schemes.
 
A variant of this is an exchange gone bad. Again the exchange operator controls a massive stake via customer deposits but no exposure, and if fraud occurs creating a fractional reserve. The exchange has a vested interest in the collapse of the currency in order to cover losses and can vote the stake accordingly.

Buying the currency while at the same time selling a greater amount on a derivatives market, creating a large stake with a short exposure and vested interest in the collapse of the currency. Again the stake can be voted accordingly.

Need I go on ...

Every form of DRM has been defeated because at a very fundamental level DRM is based upon flawed mathematics. The fact that corporations have spent billions of USD to build elaborate structures on top of fundamentally flawed mathematics or lobbied governments to pass legislation to give legal protections to these structures does not change the underlying reality.  Proof of stake suffers from a similar fundamental flaw and without a central from of authority is ultimately doomed. Building elaborate and expensive structures on top of these flaws will not solve the problem.

By the way one needs to go no further than the failure of the banking system in 2008 to understand the failure of proof of stake since banks are at a very fundamental level proof of stake organizations. 1 share = 1 vote. It took the intervention of centralized authorities central banks and governments to clean up the mess.

Unless of course it is -30 C outside and furnace cannot keep up.

Or fridges that order food only from sources that use approved GMO technology from Monsanto, thereby extending the Apple DRM model to food. No thanks. If they are stupid enough to use proof of stake, then a not at stake attack using derivatives may be the solution to save the world from this Orwellian monstrosity.

Edit: By the way this is not as crazy at it seems. http://www.theverge.com/2014/6/30/5857030/keurig-digital-rights-management-coffee-pod-pirates.

I read Sun Tzu The Art of War https://en.wikipedia.org/wiki/The_Art_of_War and the concept of ignoring my enemies simply does not appeal to me as a strategy. Here is a quote: https://www.goodreads.com/work/quotes/3200649---s-nz-b-ngf It is as relevant today as when it was written several millennia ago.

Edit: The fact that DRK left its flank wide open to a potentially crippling attack by the US Government while XMR did not is something I cannot ignore.

Then there is the little detail of the 1MB blocksize limit in Bitcoin. 

Actually I prefer to asses the regulatory risk of a crypto currency based on the actual rulings and statements provided by relevant government agencies rather than based on third party comments that are more often than not misleading if not outright wrong. It is fair to say that the US Government has been a leader in this area and relevant rulings from FinCEN can be found here. http://fincen.gov/statutes_regs/guidance/html/FIN-2013-G001.html and http://www.fincen.gov/news_room/rp/rulings/pdf/FIN-2014-R001.pdf. I would urge the reader to carefully read the guidance before reaching conclusions.   This is from FIN-2013-G001. The key point is that Bitcoin miners are deemed "users" this was further clarified in FIN-2014-R001. So of course would be someone running a Bitcoin node since they are not engaging in a "business". I fail to find anything in this guidance that is specific to Bitcoin that would not also apply to Monero. Now compare this to the situation of the Darkcoin Masternodes. Are they MSBs and subject to FinCEN regulations? I suspect that a very good case could be made since 1) They are operating as a business and compensated for their efforts and  2) Their primary function is to exchange unmixed Darkcoins for mixed Darkcoins. This could make them an exchanger under the regulations. There is an interesting discussion in the Darkcoin thread on this https://bitcointalk.org/index.php?topic=421615.45000. The implications of a FinCEN ruling on the Darkcoin masternodes as MSBs could have a significant impact not only on the Darkcoin price but also on the Monero price. All it takes is for someone to approach FinCEN and request a ruling.

The key here is that while both Monero and Darkcoin may be aiming to achieve a similar objective, how this objective is achieved can have profound and very different legal and regulatory implications.

Edit: Assessing this kind of risk is a significant reason why I have chosen Monero over Darkcoin. I may of course be proven wrong, but that is what the free market is all about.

There are alternatives based on proven track records
1) Counterparty based on the security of the proof of work bitcoin blockchain
2) IBM the "fiat" large corporation alternative.
Both of the above have forked the Ethereum code. I may be wrong but a portfolio combining both 1 and 2 above may very well outperform Ethereum.

Sent an additional 2603.40 XMR. PM sent.

Lawmakers and regulators will just legislate and regulate the on and off ramps and the service providers as they are currently doing with Bitcoin, and have done with cash for years.

There is a very important requirement here that is often overlooked. The purpose of proof of work is to enforce decentralization of the network. If the added value work that is performed can be equally performed in a centralized or decentralized fashion then doing useful work actually defeats the use of proof of work for blockchain security. Common examples that are used are distributed computing for example to solve medical problems. The trouble with this, is that this kind of computing can just as well be performed in a centralized location. If the work has value then this defeats the whole point of proof of work.

The idea is to find an application that only has value if it is performed in a decentralized way. In my example the use of electricity to produce heat is a very good example. This has value in a decentralized setting, and is in fact very useful, but it is completely useless and worthless in a centralized setting. Why? Because one can transport the electricity for thousands of km but not the heat.

To consider human work. Typing a document can be done anywhere in the world and the digital document can be transmitted electronically, so this would not work. On the other hand, serving someone coffee only has value if it is done in the presence of the person served. By its very nature this kind of work has to be performed in a decentralized fashion, and could in principle be used to make proof of work useful.

It is more like when the bulls are in a buying frenzy they will buy anything. The alt-coin become a "more affordable" version of Bitcoin. This phenomenon is best seen with alt-coins that have already being through more than one XBT/USD boom and you need an alt-coin that has some merit. In effect the alt-coin behaves as a leveraged play on Bitcoin. This phenomenon is not unique to crypto-currency. It also happens with gold stocks where the juniors appreciate in value with respect to the seniors in a gold boom. I have also seen it in real estate markets.

If XMR on its own accord does not do anything out of the ordinary I would expect a spike to over 0.01 XBT and possibly even as high as 0.10 XBT under such a scenario, just based on the performance of other alt-coins is past. Here are some examples: http://www.cryptocoincharts.info/pair/ltc/btc/btc-e/alltime, http://www.cryptocoincharts.info/pair/nmc/btc/btc-e/alltime. That would place XMR/USD in the 5600 to 56000 range.

If there are significant improvements in XMR then it could be higher.

Please let us stay on topic which is making POW useful rather attempting to promote yet another alt-coin.

Not for me

It seemed to me that this would, for starters, favour whoever has the best worldwide Internet peering. This would lead to centralized control.

So it is a POW coin after all?

No thanks.

... and the proposal is to replace POW with?

Most electronics are not thrown out because they fail. They are thrown out because of planned obsolescence driven by propriety software and DRM. E-waste is one of the fastest growing environmental problems today. As for a "more efficient central heating system" what do you have in mind? We are going in circles here.