The point is that any single redditor can easily afford to throw away a $600 check they may not have been counting on in their budget. It’s “free money”. The hedge funds can’t really afford to lose billions of dollars.
So if you can, relatively painlessly, inflict a lot of pain on someone you view as a mortal enemy, then why not?
If a group of institutional investors are on the hook for 100% of the shares in a short sale, then they have to cough up $300 million collectively to cover their trades in a company that's really only worth $10 million. They're on the hook for a $290 million loss. But if the run-up from $10/share to $300/share is being driven by a million small operators who have been buying it up at $300/share and no one speculator owns more than one share, then each person is only facing a $290 loss while the collective loss would still be $290 million.
When you crowd-source chaos, this helps spread the risk considerably.