Yes, Ken is aware of Mastercoin, as well as the potential for using Ripple. I think that it will be color coins, I believe this will be the best option and will be available the soonest.

There is also something new called 'bitshares'. Something similar to mastercoin it seems, except it is a new cryptocurrency based off of RAM mining, so it's very different in that regard. It's an interesting project by Invictus Innovations, I've heard the interview from Let's Talk Bitcoin. They're trying to develop a decentralized anonymous internet and a decentralized securities market. It'll probably be a while though.