Can only agree. There is a really simple reason for not allowing naked short selling and that is the potential for effectively creating a divide by 0 error, when the short sellers have to cover their short, and there aren't enough shares available. It really is that simple.
While this doesn't mean a price of infinity, since price is also constrained by the available money for the purchase, in reality this then becomes a liquidity trap which is guaranteed to bankrupt the least liquid short sellers until enough positions have gone under to bring the short position down under the float size. So whilst some flexibility may make sense to resolve some of the buffering issues with settling, if that is being deliberately exploited as claimed in the article, that is a huge regulatory problem.
While this doesn't mean a price of infinity, since price is also constrained by the available money for the purchase, in reality this then becomes a liquidity trap which is guaranteed to bankrupt the least liquid short sellers until enough positions have gone under to bring the short position down under the float size. So whilst some flexibility may make sense to resolve some of the buffering issues with settling, if that is being deliberately exploited as claimed in the article, that is a huge regulatory problem.