What are the odds this attack didn't involve a pdf exploit?

You might want to check into a class of crowdfunding sites that exist to fund features in free and open source software. The two main ones I could find are:

https://www.bountysource.com/
https://bountyoss.com/

Just a few corrections. The targeted rate is 2016 blocks per 14 days. The default client allows you to spend incoming coins after one confirmation.

As someone who takes a pragmatic view of software freedom and considers business interests carefully, what are your thoughts on decentralized virtual currencies such as Bitcoin as they relate to individual freedom as well overall economic efficiency?

Bitcoins are actually becoming more plentiful to the tune of 3600 more being created each day. The more you look into it, you'll see that people have many interests in Bitcoin. Some want to start mining hardware companies, some do ponzi schemes, some see it as a revolutionary payment system and economic tool, some see it as freedom. How do you see it?

Regulation is not a monolith. There are some good laws and some bad ones. I think we'd like to point out that the ones aroud money laundering are particularly bad in that they are not very effective for catching crooks but very good at stopping normal people from providing for themselves.

True. Transaction fees are expected to support the processing and security of the network more and more as time goes by. Transaction fees are already over 1% of the amount minted daily in new coins. As bitcoins are more widely distributed and transaction volumes increase, it is plausible to me that the fees will serve their purpose. Rather than argue about some absolute everything is free idea, what we should look out for are things that increase the real cost of sending transactions, such as spam and poor network connectivity.

It depends on the size of the transaction. Space in the blockchain and processing time are not free as miners are competing to have their blocks accepted by the rest of the network as soon as possible after they are found. The transaction fee for most transactions to get included right away is 0.0005 btc which is about $0.05 For average confirmation time, whcih has been decreasing due to greater hashrates see http://blockchain.info/charts/avg-confirmation-time

I read your article which was surprisingly in-depth. I think your perspective on previous bubbles is very helpful but there are a few inaccuracies there when it comes to the technical details of Bitcoin...it's hard to say with one reading if correcting them may change much in terms of a conclusion but if you are interested, I'll go point them out in an email.

It's called arbitrage and you can think of it like a financial circuit. Sell bitcoins and get Pesos. Sell Pesos to get something else (USD?). Sell that something else for bitcoins. Repeat.

As long as you're charging enough fees to cover your costs, you can make money this way and help people protect their assets with a far more trustworthy, even gold-like currency.

Except that bitcoins don't just sit in a cabinet looking pretty. The purpose they serve is to send value from one party to another without requiring the trust of any third party. Transfers happen within an hour or two with fees ranging from 0-1% depending on if you're starting and/or ending with bitcoins.

If bitcoins become worthless in the future, it will only be because another decentralized payment system (probably based on Bitcoin) will have made a significant improvement. People are trying all the time to release a new Bitcoin with some more attractive properties but the system is very good, it's hard to improve upon while still maintaining the decentralized, trust-free essence at its core.

Second life currency cannot be stored outside Linden Labs system. It is just an entry in their database. With Bitcoin, you have your private keys and any money assigned to them is under your sole control. Of course, you may place your private keys in a foolish place but it is your duty to yourself to take precautions in relation to the value therein.

I'm not familiar with second-life banks but I doubt they were truly able to hold SLL so that they were under their sole control. Linden Labs could always claim TOS violation and remove the money from their account. Not so with Bitcoin which is why you keep hearing about the system. It's a genuinely different virtual currency.

What you're seeing with Bitcoin is sort of like raw access to the Visa network and I'm surprised more theft doesn't occur. As you pointed out it's nontrivial to have a secure computer nowadays.

As the infrastructure evolves we are likely to see payment processors that use things like multi-sig transactions and stronger security measures to insulate the user from such concerns. Even then, you'll still have the freedom to operate independently.

Freedom(tm) - A (previously?) core value of the /. community.

As far as you know. And you know as well as anyone that data copied need not be used immediately. I won't say that every Bitcoin business has been or will be above board but the fact that there is a public transaction log makes certain activities very hard to hide or explain away. As for reclaiming stolen funds, the largest thefts occur at the top. MF Global for example is missing $1.2-1.6 billion. That is an amount of money that can affect millions of people in ways they would feel.