Paragon TotalDefrag has this feature and it works pretty fast.
CCleaner has Drive Wiper which does similar job, but it takes too much time as it's actually wiping the whole free space and is forcing MFT to shrink, though when it gets close to 99% it triggers System Restore which then deletes one or more SR snapshots as the disk space gets very low. It's not a bug, but may need some improvement.
Anyway, what I'm proposing is just to include similar feature to Defraggler, but instead of wiping the free space just compact MFT and defrag it.
Compact and defrag probably describe the same action.
In XP if the MFT is in several fragments within or even out of the MFT Zone (disk full/stressed) then these fragments can be defragged - made contiguous again - back within the Zone. I think that most defraggers do that already.
In Vista onwards the MFT Zone is much smaller (200 mb) and when the MFT fills it another 200 mb zone is created elsewhere. The zones are deliberately fragmented, and M/S says that making these zones contiguous is possible but pointless in performance times.
You can't mess around with any of the insides of the MFT. If you create a million files and then delete them the MFT will contain a million entries forever.
Apart from the first known system records, the only sequential read of the MFT (as far as I can think) is on new file/folder allocation, when the first (lowest numbered) free slot is used. NTFS probably reads the MFT bitmap to find the first free slot, then multiples that -1 by 1024 to find the free slot offset. So no sequential reads at all.
I can't see any practical reason why CC's Wipe MFT shouldn't be separate. It does run before WFS so it is a separate entity. As for taking a long time, it's creating tens or hundreds of thousands of new files, every one with a corresponding transaction record, MFT folder update, bitmap update, etc, then deleting the lot, every one with a corresponding transaction record, MFT folder update, bitmap update, etc. That takes time.
(Later edit) I can't see any performance gain from wiping MT entries. It's a way of replacing the existing file name and folder reference in a deleted MFT record with another. The MFT has the same number of entries, in the same order, as before.
At risk of necroposting - has any progress been made on MFT compaction and truncating within Defraggler? Keep in mind this needs to be an out-of-windows operation.