It looks like the diehard bitfinex traders are just keep taking more and more margin positions, until they all get liquidated somehow.
what happens when they get liquidated? whats the end result of all these traders taking more and more margin positions?
BFX was still linked up with Bitstamp at that time and they had run out of funds. They shut down trading for 2 hours but nobody got margin called or anything because of it, we just lost some really good opportunities during that time frame.
Now that they provide swap insurance themselves if a massive sell off happened again they would probably just do the same thing until it blew over.