I do engineering on these systems and have some expertise on this particular class of event. We’ve had tabletop red teams, and the general outcome is that rail systems being designed to ‘fail safe’ is an easy target. Failing safe at an individual actual ‘fault’ is still the best option, but it could be abused at scale.

It’s near impossible to cause two trains to run into each other (unless you are physically operating one of them), but it is really easy to cause all trains in an area to stop because a cross check or a bit has flipped. In this case, they literally flipped a bit by short circuiting the track circuit.

If done at scale, it is still possible to bypass and run trains safely the old fashioned way. It is less safe, but would probably be the decision if this was happening at multiple locations everyday.