The Hedge Fund guys went overboard with Short Positioning. They sold more shorts than there are shares of stock. Shorts are effectively "borrowing with the promise to buy it at value later, expecting it to decrease in value." Except once WSB went in, the value SKYROCKETED, and what would have cost them $20/share was looking like it would cost them $350/share. Now multiply the difference by ten million shares. That is how much of a loss the hedge fund is taking.

The Hedge Fund guys went overboard with Short Positioning. They sold more shorts than there are shares of stock. Shorts are effectively "borrowing with the promise to buy it at value later, expecting it to decrease in value." Except once WSB went in, the value SKYROCKETED, and what would have cost them $20/share was looking like it would cost them $350/share. Now multiply the difference by ten million shares.