Since multiline paragraphs have been permitted since 0.4, it should also be
the case for list elements. I.e.
{{{
* some long
list item
}}}
should be rendered like
{{{
* some long list item
}}}
An empty line would be used to start a paragraph.

An empty line marks the end of all lists, even deeply nested ones:
{{{
* a
* b
** c

*d
}}}
is rendered as
{{{
<ul>
<li>a</li>
<li>b</li>
<ul>
<li>c</li>
</ul>
</ul>
<ul>
<li>d</li>
</ul>
}}}