The website doesn't load for me so I can't see all the details, but $100K seems like pennies when you compare it to the profit-making potential of the winner. I could be completely wrong though so if you can win the money without having to hand any intellectual property over to machi.na, it sounds like a sweet deal. So if you are not a trader already and you develop this, the $100K will set you up for a very profitable algo career!

Otherwise the business side in me looks to this as 3 things:

1. Cheap way to optimize your program by utilizing 'free labor'. If hundreds enter this contest and machi.na has access to their modifications, then that is information that is very likely worth over $100k.
2. Great marketing
3. Potential recruitment tactic, a very very good one

Again I want to emphasize the fact that I'm speculating purely on what I've read on this post so far, as I have not been able to access the site. This is just my 'knee jerk' reaction I guess.

I hope this doesn't come off as cynical because I think this is a genius business decision.

Sounds very interesting, cheers!