I'm not saying they aren't shorted, I'm just saying it isn't Melvin. There are lots of people shorting GME when it's priced a large multiple of it's long term value. How this gets resolved given the giant short squeeze is another question. Certainly I wouldn't be brave enough to be on either side of the trade.

And even if it is new shorts, then it becomes a race between shorts and longs, which longs would have a huge advantage barring direct manipulation.