Pabel's idea is that you can store sensitive data, such as keys, in the CPU's cache, disable cacheing, and zero the data from memory. This should leave us with the key stored in a usable state in the CPU. It's a good concept, but unfortunately it doesn't seem to be much more than a concept at this point.
Not surprisingly, CPUs have caches for a reason and when they are disabled, performance suffers. In Pabel's demo, he was running what seemed like nothing more than a terminal to enable and disable his proof-of-concept and even that was painfully slow. I realize that Pabel was not presenting a full solution, and I know how far from complete many POCs are, but I'm not sure how much optimization can actually be done.
x86 processor's simply weren't designed for this sort of cache abuse. They don't offer enough control over the cache for this method to really be feasible. There are no obvious ways to disable only the parts of the cache of our choosing, and no way to prevent others from flushing the cache and either destroying our sensitive data or dumping it to RAM.
What we really need is a hardware-tailored solution to this problem. I think there is a need for a dedicated piece of hardware, either built into the CPU or with fast access to it, that could be used as forensically secure storage for sensitive data. Similar solutions seem to work reasonably well in consoles (unless you are into epic math fails like Sony).
Overall, cold boot attacks aren't a huge problem, since they require physical access to pull off, but with an increase in government asshat-ery at airports it would be nice to have a solution.
UPDATE:// Juergen was kind enough to address my concerns in the comments. Read on.