The risk of a problem with MtGox has been the greatest risk in Bitcoin's recent rise to stardom, and this is a plausible (and exciting) fix for that.  

Note though, I am coming from a perspective of understanding to some extent how business actually works, and not some pie in the sky fantasy of how MtGox should be some sort of anarchist stronghold waging some kind of cyber war with the big bad government and banks.  Those who are saying "this sucks, Bitcoin as we know it is ruined" ought to sell their coins now and get out while they are ahead!

That didn't work out too well last time did it?
It only needs a few fat finger trades to ruin it, sure $100 can happen in a flinch - the question is if it will rise further on its own. Nobody wants to overpay for an asset, no matter how good (you think) the fundamentals may sound.

This is not an issue. When you've decided to allocate significant funds into BTC, the issue is not "driving the price up to 100". The issue is preventing it from shooting up to 100 before you're done with your allocation. BTC "market cap" is ridiculously low, and the free float is much lower still (one estimate is 25%, so just a bit north of USD 40 million). So, deploying even relatively insignificant amount like several million USD is very likely to disrupt the balance and push the price up by quite a bit.

Now, much more interesting question is: How do you actually deploy significant funds into BTC without pushing the price over 100?

Here is how. You move your funds to Mtgox slowly over time, in small portions not more than 50K USD each. You carefully stack your bids, keeping most of them way below the market to avoid influencing the everyday price discovery while taking advantage of petty market panics. You also keep the ask side artificially high with off-market walls to create an illusion of BTC abundance. From time to time you set up huge ask walls close to market to provoke the bears and small speculators into dumping their coins. You buy all the dumps without looking too eager. You damn the moron bulls who show off their bid walls too close to market and scare away the bears. With luck and patience, you'll be able to accumulate quite a bit of coins without too many people noticing what's going on. Your job is to prevent the market from realizing the scale of redistribution that is happening before your funds are fully deployed.

Oh yeah, and you do not even bother to drive the price up. The fundamentals of bitcoin adoption will do it for you in any case, making it a 10-bagger at the very minimum. You are quite sure about it, as you've done your fundamental analysis and due diligence beforehand. So, it does not matter much if it happens within 1 year or 10 years. Let the speculators be excited about "OMG, BTC is going to 17! no, it'll be even 17.5! and then I'll dump!".

Does the market behavior described above look familiar to people watching Mtgox for the last year or so, by any chance? Hmm, I wonder why is that...

From June to Sep, the price nearly tripled without any significant fundamental news(unless i missed something).
Then pirate defaulted and there was a spike down to $7+, which was readily absorbed and price has slowly creeped back up to where it is now(14+).

Yes, i know Wordpress started accepting BTC recently and Bitcoin is going to be gaining exposure at CES. More businesses are accepting bitcoin, all well and good.
But a 300% gain(all before Wordpress and CES news) just smells fishy to me.

What i think:
A 300% price gain in 3+ months without any significant fundamental reason is the work of 1 large buyer.
1) Maybe this buyer heard of bitcoin, did his research and believes in it as much as we do and is trying to scoop them up while they are still a bargain and is in this for the long haul.
2) This large buyer is here to make a quick 200-300% gain. Ever since price has risen to 12+, all the buy orders that were $5 and below have slowly crept up into the $12+ range.
If you look below 12.90 in the market depth table, there is very little liquidity to hold the price. It's almost as if the the large buyer has suckered everyone into buying at $13+ and is slowly letting his coins go whilst keeping 1-2 big orders below market price to give the illussion that there is very strong demand.

Personally i was thinking it was scenario 1, but after watching the PA and the market depth today, its starting to look like the chances of it being scenario 2 is not remote. Also a rich banker or fund investor is unlikely to have the technical background to understand the details of Bitcoin and appreciate the genius of it's design or believe in it's security.

Everything on the net (especially on their website ripple.com) is very opaque.

@ OP:  Mind telling us a little bit more on how the new dev team implemented the idea of ripple?

I repeat, there are XRP and IOU. They aren't the same thing.
You should give a better look at the interface.

Are you saying that they should go against the market?

There are XRP and IOU.
XRP are needed to avoid spam/ddos.
You aren't forced to use them as currency.

Yep. There is no way to short large amounts of BTC, so that is true.